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FSP urges NPP MPs to reject unfair tax policies
The Frontline Socialist Party (FSP) has sent a letter to all MPs of the ruling National People’s Power (NPP) government, urging them to reject what it describes as a severely unfair tax policy outlined in the 2025 Budget. The party has warned that the proposed tax structure will place an unbearable burden on the public, while at the same time granting significant concessions to large corporations and wealthy individuals.
The 2025 Budget, which was presented to Parliament on 17 February, is scheduled for a final decision on 21 March. The FSP stated that tax policies were generally designed to reduce economic inequalities, prioritise economic development, and regulate market consumption patterns. It argued that the 2025 Budget approached taxation solely as a means of generating government revenue, disregarding the economic hardships faced by the majority of the population.
The FSP has raised concerns over the significant increase in Value Added Tax (VAT) on goods and services, which is set to rise by 25.94% in 2025. The government aims to increase tax revenue from Rs. 2,201 billion in 2024 to Rs. 2,772 billion in 2025, resulting in a notable rise in the financial burden on ordinary citizens. According to the FSP’s analysis, this means that in 2024, an average Sri Lankan household paid Rs. 31,623 per month in indirect taxes on goods and services. In 2025, this figure is expected to increase to Rs. 39,817 per month, placing an additional Rs. 4,200 in taxes on each household. The party argued that this increase is unbearable for families already struggling under the weight of the economic crisis.
Citing data from the Department of Census and Statistics, the FSP has highlighted that the average monthly household income in Sri Lanka is Rs. 76,414, while monthly expenses amount to Rs. 63,130. It has warned that nearly two-thirds of a family’s monthly spending would now be consumed by taxes, describing this as a severe economic blow to working-class and lower-income groups. The party accused the government of betraying the expectations of the people who placed their trust in the NPP administration.
While the government has defended its decision by claiming that the higher VAT collection is not the result of introducing new taxes, but rather improving tax enforcement, the FSP dismissed this argument as misleading. It pointed to the Ministry of Finance’s own report, which stated that between 2023 and 2024, businesses collected Rs. 333.1 billion in taxes from consumers but failed to remit them to the state. Despite this massive tax evasion by corporations, the 2025 Budget does not prioritise recovering these unpaid revenues or strengthening direct taxation on high-income earners. Instead, the government has doubled the withholding tax on savings from 5% to 10%, imposed a 15% tax on foreign income earned through online services, and extended import duties on 63 essential goods, including food items, from 1 January 2025.
The FSP also criticised the government’s handling of VAT rates, which have been rising continuously since 2022. The VAT rate, which was 8% in early 2022, was increased to 12% in August 2022, then raised to 15% in January 2023, and further increased to 18% in January 2024. The party warned that the government appears to be following a pattern of gradually increasing VAT, making it even more difficult for ordinary people to afford basic goods and services. Additionally, a Social Security Contribution Tax was introduced in 2023, further exacerbating financial pressures on the public.
Beyond the tax hikes on ordinary citizens, the FSP condemned the favourable treatment given to wealthy individuals and large corporations. It cited a Parliamentary Committee on Public Accounts (COPA) report from March 2024, which revealed that large corporations evaded Rs. 1,068 billion in taxes, while domestic and foreign corporate entities received tax concessions worth Rs. 978 billion. Despite these staggering figures, the government has only planned to increase direct tax revenue by Rs. 141 billion, indicating that it has no real intention of recovering unpaid taxes from the country’s largest businesses.
The FSP also highlighted a controversial clause in the 2025 Budget that offers a six-month amnesty period for overdue tax payments. This clause, buried in the technical section (Clause 1.9) of the budget document—which was only released in English—states that businesses that failed to pay taxes between 2022 and 2023 can settle their dues without facing penalties or interest charges. The party described this as a shameful giveaway to tax-evading corporations, arguing that it directly undermines the government’s claims of enforcing tax compliance.
In its letter to MPs, the FSP urged lawmakers to reject the tax policy and stand against what it called a blatant betrayal of the public interest. The party reminded Parliamentarians that Sri Lanka’s economic crisis, IMF-imposed financial restructuring, and rising inflation have already pushed millions into financial hardship, and that imposing additional tax burdens on struggling families would only deepen the crisis.
The FSP warned that if MPs vote to approve these unfair tax measures, they risk facing public outrage and a loss of trust. It called for an immediate revision of the 2025 Budget’s tax policy, urging the government to shift the tax burden away from ordinary citizens and onto the country’s wealthiest individuals and corporations.
News
PM meets UN Resident Coordinator
A meeting between Prime Minister Dr. Harini Amarasuriya and the United Nations Resident Coordinator in Sri Lanka, Marc-Andreé Franche, was held on the 20th of December 2025 at the Prime Minister’s Office.
During the meeting, Mr. Marc-Andreé Franche commended the swift coordination in which the Government acted to rescue affected communities and provide relief following the recent natural disaster situation faced by Sri Lanka.
Comparing experiences from other countries around the world, he noted that the level of international support Sri Lanka has received during such a disaster is exceptionally high. He further emphasized that he would utilize both his professional capacity and personal commitment to the fullest extent to ensure that Sri Lanka receives the necessary assistance.
Expressing appreciation for the continuous support extended by the United Nations to Sri Lanka, the Prime Minister stated that the role played by both the political authority and public officials in the field during this disaster management effort was exemplary. She highlighted that the collective and coordinated efforts of all parties from district leadership to the ground-level officials have become part in this success.
The Prime Minister also affirmed that the Government remains committed to properly managing the international assistance received and to rapidly restoring normalcy to the lives of people in the affected areas.
The meeting was attended by the secretary to the Prime Minister Pradeep Saputhanthri and Secretary to the Ministry of Education Nalaka Kaluwewa
[Prime Minister’s Media Division]
News
Suspension of Indian drug part of cover-up by NMRA: Academy of Health Professionals
President, Academy of Health Professionals, Ravi Kumudesh, yesterday (22), alleged that the National Medicines Regulatory Authority’s (NMRA) decision to suspend several batches of Ondansetron Injection USP 8 mg/4 mL (Batch Nos: OD24021E, OD25009E, OD25024E, OD25023E), following suspicions of patient complications, and a few reported deaths, seemed to be a bid to cover-up the latest public health sector crisis.
Kumudesh said so responding to The Island queries.
Kumudesh pointed out that the Chief Executive Officer of the NMRA, and other responsible officials of the Ministry of Health, were on record as having said that the alleged bacterial contamination in the medicine in question was based on laboratory test results generated at the Microbiology Laboratory of the National Hospital, Kandy.
He, however, emphasised that the Kandy facility lacked legally mandated facilities, validated systems, or regulatory accreditation required to conduct pharmaceutical sterility testing in accordance with internationally accepted regulatory standards.
“The Academy of Health Professionals is aware that the Microbiology Laboratory of the National Hospital, Kandy, does not possess the required facilities,” Kumudesh said, urging the government to come clean in this matter.
Kumudesh said the regulatory action taken by the political authority was aimed at deceiving the public, and theAcademy of Health Professionals had raised the issues with Health Minister Dr. Nalinda Jayatissa, Health Secretary Dr. Anil Jasinghe, NMRA head Dr. Ananda Wijewickrama and Director General Health Services (DGHS) Dr. Asela Gunawardena.
Kumudesh pointed out that the Kandy facility was meant to meet requirements within the Kandy National Hospital and not a world standard testing lab. Kumedesh sought an explanation as to how the suspended Ondansetron Injection had been administered on 13 December to a person warded at the hospital where NMRA head is based, a day after the NMRA decided to suspend it.
Public health sector trade union activist Kumudesh said that the Health Ministry couldn’t turn a blind eye to the disclosure that post-mortem reports of two persons, who allegedly died after being given the same medicine by the National Institute of Infectious Diseases, did not identify the medicine as the cause of death. According to him, the National Institute of Infectious Diseases administered the same medicine to patients, on multiple occasions, in the wake of the controversy.
Kumudesh said that it would be the responsibility of the government to ensure a comprehensive technical, legal, and administrative investigation into, what he called, Ondansetron affair. Having lambasted all previous governments of waste, corruption and irregularities, at the expense of the hapless public, the NPP couldn’t, under any circumstances, side-step the issue. “In the interest of transparency, regulatory credibility, and the protection of public health, this should be properly investigated,” Kumudesh said.
The crux of the matter was that the very basis of NMRA’s suspension of Ondansetron batches seemed to be irregular and questionable, Kumudesh said.
The Academy of Health Professionals, in its letter to Dr. Jayatissa, sought the Health Ministry’s response to the following questions: 1. Who requested the Microbiology Laboratory of the National Hospital, Kandy, to conduct sterility testing on this medicinal product?
2. Under what legal provisions was such a request made, and on what basis was the laboratory authorised to accept and perform such testing?
3. Who conducted the test, and who issued the report? Did those individuals possess the requisite professional qualifications, regulatory authorisation, and legal mandate to do so?
4. Did the laboratory possess the required infrastructure, validated testing systems, quality assurance mechanisms, and specialised training necessary to perform pharmaceutical sterility testing in compliance with regulatory standards?
5. If patient complications were attributed to microbial contamination, were all related materials—including syringes, IV lines, infusion fluids, and other associated devices—systematically tested? If not, on what scientific basis was it concluded that the contamination originated exclusively from the medicine?
6. Given that the NMRA is legally empowered to suspend a medicine as a precautionary measure, even without laboratory confirmation, when serious safety concerns arise, what was the justification for relying on an irregular and non-regulatory laboratory test instead?
Kumudesh stressed that Ondansetron, and nine other injectable medicines that had been suspended, were all ordered by the State Pharmaceutical Corporation (SPC) from an Indian manufacturer, Maan Pharmaceuticals.
By Shamindra Ferdinando
News
Dr. Jayatissa visits India amidst Ondansetron controversy
Amidst the ongoing controversy over the suspension of several batches of Indian manufactured Ondansetron Injection USP 8 mg/4 mL (Batch Nos: OD24021E, OD25009E, OD25024E, OD25023E) over safety fears, Health Minister Dr. Nalinda Jayatissa undertook a visit to New Delhi.
The Indian HC in Colombo said: ‘Dr. Jayatissa, the Minister of Health and Mass Media of the Government of Sri Lanka led a delegation to India from 17–19 December 2025 to participate in the 2nd WHO Traditional Medicine Global Summit held at Bharat Mandapam, New Delhi. The Summit was jointly organized by the World Health Organization and the Ministry of Ayush, Government of India.
The Summit was held under the theme “Restoring Balance: The Science and Practice of Health and Well-Being” and aimed to advance a global movement focused on restoring balance for individuals and the planet through the scientific understanding and practice of traditional medicine.
During the Summit, the Minister participated in the Ministerial Roundtable and delivered his remarks, highlighting Sri Lanka’s perspectives and rich traditions in Ayurveda and traditional healing.
During the visit, the Minister held bilateral meetings with Anupriya Patel, Minister of State for Health & Family Welfare, Government of India, and Prataprao Ganpatrao Jadhav, Minister of State (Independent Charge), Ministry of Ayush, Government of India. Discussions focused on strengthening cooperation in healthcare and traditional medicine, including regulatory collaboration, research linkages, and capacity-building initiatives.
On the sidelines of the programme, Minister Jayatissa also visited Apollo Hospitals to gain insights into the implementation of Public-Private Partnership (PPP) models and to explore best practices.
The visit reaffirmed the shared commitment of India and Sri Lanka to deepen collaboration in the fields of health and traditional medicine and to explore new avenues of partnership for the benefit of the people of both countries.’
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