Finance Minister explains VAT amendment amidst anxious business enviroment

Finance Minister explains VAT amendment amidst anxious business enviroment

Finance Minister explains VAT amendment amidst anxious business enviroment

Written by Tharushan Fernando

06 Aug, 2016 | 10:09 pm

Will Value Added Tax increase the cost of living?

A number of business institutions and trade associations are still in a dilemma. The parliamentary vote pertaining to the Value Added Tax Amendment Bill is to be held on August 11.

The bill was to be taken up for debate on July 20. This was however delayed as the Supreme Court made a ruling, cancelling the order made by the Commissioner of the Inland Revenue Department increasing the percentage of VAT. The Supreme Court made the ruling citing that the VAT percentage being increased from 11 percent to 15 percent from May 2, without the approval of the parliament, cannot be accepted.

Minister of Finance Ravi Karunanayake discussed this matter with the trade association members of the Anuradhapura area on Saturday as well. He added that people pay the taxes, however what was due from the business sector was not received.

He also noted that as an example, there are two million single and partnership business registered in the country but only 15000 pay there taxes.

“How will the country move forward? There are many arguments about VAT. Even I do not like it”, charged the Minister of FinanceHe pointed out that despite the arguments against VAT there is a problem where the income of the country is low but the debt is high.

“We will do one thing, we will simplify it. It will not be what we say it is”,  he said and went on to point out that it can be reduced to a much lower level but time is needed – around six months, ten months or a year

The All Ceylon Trade Union Collective says that it will resort to stern action if the there is no relief from VAT.

Minister of Finance Ravi Karunanayake further charged that it is the people in the Trade Union Collectives – are the rogues who do not pay taxes,  and in terms of relief, solutions can be provided for ‘these dilemmas’ within 10-12 months

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