Written by Ramesh Irugalbandara
13 Mar, 2019 | 11:45 am
Colombo (News1st) – Minister of Finance Mangala Samaraweera says that the Government has intervened to control the prices of fuel. Addressing a media briefing at the Ministry of Finance today, the Minister revealed that if the fuel price formula was allowed to run its course the current fuel prices would be very different.
Fuel prices were revised last night and as a result of the revision, the price of a litre of 92 octane petrol increased to Rs 132 from Rs 129. However, the minister revealed that according to the fuel price formula the price of a litre of petrol should have been increased to Rs 137. He added that diesel prices should have risen to Rs 117 per litre instead of the current price of Rs 104.
The minister stated that the government decided to intervene to control the prices because of the new year season. He added that the Government will continue to intervene if the people cannot bear the change. Samaraweera justified his actions by stating that this practice is being adopted in other countries (such as India) as well.
A transparent pricing formula for fuel was suggested by the IMF as a way of eliminating political bias from the decision-making process. However with elections fast approaching it seems as if the government is cutting a few corners of their agreement signed to obtain the IMF’s Extended Fund Facility. Despite the government claiming on a number of occasions that the budget and their current actions are not aimed at the upcoming elections, such actions throw a shadow of doubt on these claims.
The minister while speaking on a number of concerns raised regarding the current budget, also addressed concerns regarding the taxation of children’s savings accounts. He clarified that a withholding tax of 5% will be imposed on children’s savings account if they have an interest income of over Rs 5,000.
Minister Samaraweera noted that in order to generate an interest income of over Rs 5,000 a child will have to have over Rs 1.2mn in his/her bank account. The minister jokingly said that “rich babies need to get used to paying income taxes” because some of them don’t do so when they grow up.
When questioned about SriLankan Airlines, the minister of finance immediately stated that if it was up to him he would have sold off the airline immediately. The minister then noted that he is of the opinion that SriLankan Airlines is a vanity project.
The minister went onto state that he would be taking steps to gazette SriLankan Airlines under the purview of State Minister Eran Wickramaratne so that he could work on it full time and come up with a solution.
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