Mansion tax – FM Ravi Karunanayake explains

Mansion tax – FM Ravi Karunanayake explains

Written by Bella Dalima

31 Jan, 2015 | 10:35 pm

With the announcement of the new government’s Interim Budget 2015, the newly-imposed Mansion Tax has become the most talked about feature of the budget.

Speaking at a forum on the Interim Budget Live on MTV Sports on Friday evening, Ravi Karunanayake the Minister of Finance elaborated on this much-talked about mansion tax.

Please watch video.

Questions : So apartments will not be affected?

 Ravi Karunanayake : Except penthouses.

Question : In-terms of size, or?

Ravi Karunanayake : That 5000 sq ft., do not worry about that. We may have to do some correction on that area. This is not a purity tax. It is important gains that will be collected. So we will be very very humane on that approach.

Question: Some people who have inherited I would basically get in to trouble .

Ravi Karunanayake : Inherited from Generations and not in 10 years.

However, the Frontline Socialist Party today said that this taxation is yet another facade.

Secretary of Frontline Socialists Party, Pubudu Jagoda said;

The question all about houses over 5000 sq ft. There is yet to be clarification on the Diplomatic Offices, State Institutions and other establishments connected to such houses , specially in the city of Colombo. The Government clearly needs to provide an explanation for this.

Deputy Minister of policy planning and economic Affairs, Dr. Harsha de Silva expressed these views on 30.01.2015 over the phone ;

The tax dubbed ” mansion tax” aims at only charging taxes that the country is due, from those who built luxury houses in the recent past in Colombo. These are not for villas that were built in the past that have been passed down for generations. Though they are large houses sometimes the retirees who live in those houses do not even posses 10,000 rupees let alone one million rupees. When discussing about the criteria we took this into consideration. We are also hoping to come up with a system to charge the million rupees in a just manner with a feasible plan. We are hoping to formulate a plan where the 1 million rupees will be charged justly.

Meanwhile, the Minister of Finance, Ravi Karunanayake called on the Chief Prelate of the Malwathu Chapter Most Venerable Thibbotuwawe Sri Sumangala Thero.

During the meeting, the Chief Prelate inquired from the Minister on the Mansion Tax.

Minister of Finance, Ravi Karunanayake explained:

There was a view among the public that there is a portion that have gone astray or have been distracted. If not we have to think there is no point in taxing a small house but to tax a luxury house. All we had to do was make a small amendment. There may be issue for those who inherit houses through generations. That is not our view. This tax is for those houses that came up within the past five to six years.

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