The tax on personal income was imposed as a short-term strategy to resurrect the country from the existing economic situation, the Director General of the Department of Financial Policy, Kapila Senanayake stated.

According to the President’s Media Division (PMD), Senanayake said that this new tax system in Sri Lanka is of a meagre percentage compared to other Asian countries. 

Senanayake also stated that there is an opportunity to discuss short-term strategies to provide some relief by considering trade union leaders and civil organization representatives’ views and suggestions on the new tax system. 

According to the instructions of the President’s Secretary Saman Ekanayake, a meeting was held yesterday (06), presided over by the President’s Trade Union Director General Saman Ratnapriya and the Director General of the Financial Policy Department Kapila Senanayake, to inform the trade union leaders and representatives of civil organizations regarding the new tax policy on earnings. 

These details were made public during the event, which was hosted at the Finance Ministry Auditorium. 

According to Saman Ratnapriya, the new tax policy that is assessed at the time of earning has created difficulties for government and semi-government employees, and as a result of the issues they have experienced, they have responded professionally. It was also made clear that the main goal of this conversation was to gather concepts and recommendations to find solutions to the current issues. 

Saman Ratnapriya also stated that these conversations will result in swift short-term solution recommendations that may be taken to address the difficulties that have emerged. These quick short-term solution proposals will be presented to the President and the Prime Minister.

Speaking at the event, Director General of the Department of Financial Policy Kapila Senanayake explained in great detail about the government’s revenue, government spending, and financial strategies used to reduce the annual budget deficit. He also mentioned that Sri Lanka has a very low percentage of personal income taxation when compared to other Asian nations.

Kapila Senaratne further explained the financial situation in Sri Lanka, problems of personal taxation, tax reforms related to personal income tax, the basis for increasing personal income tax and the implications of tax reforms. 

In addition to outlining numerous tax rules, Senior Deputy Commissioner of the Department of Inland Revenue K.K.I. Eranda also described how taxable personal income is calculated as per the new tax law. 

The trade union leaders who took part in the discussion stated that there are issues with the new tax policy’s tax system that is imposed on personal income and that the trade unions should be consulted before creating the tax policy. The trade union leaders further demanded that fair services be given to the public for the taxes levied like in other countries, and prompt solutions should be provided to reduce the inconvenience the professionals face due to the new tax act faces. 

Inland Revenue Department Deputy Commissioner W.M.G. Kumaratunga, Tax Adviser, Fiscal Policy Division of the Ministry of Finance, Tanuja Perera Prime Minister’s Trade Union Secretary, Chandraratne Pallegama, trade union leaders, representatives of civil organizations and several others attended the event. (NewsWire)

The post Personal income taxation a short-term economic development strategy – Govt appeared first on Newswire.

A Samagi Jana Balawegaya (SJB) government, if elected, will renegotiate the Personal Income Tax (PIT) minimum threshold with the International Monetary Fund (IMF), former Minister and party member Eran Wickremeratne said.

Speaking to The Daily Morning Business, MP Wickremeratne said the PIT minimum threshold will be renegotiated with the IMF to be increased to a minimum rate of up to Rs. 250,000.

According to Co-Cabinet Spokesman Bandula Gunawardana, the initial minimum taxable monthly income proposed by the IMF was Rs. 45,000, but the government later managed to negotiate and increase it up to Rs. 100,000, he pointed out.

MP Wickremeratne said that he was of the view that the minimum taxable income should be set at Rs. 250,000, as some earners are required to look after themselves and their families, and cannot be considered a “burden” to the State. 

The SJB MP emphasized that it was essential not to make the working class dependent on the state for welfare benefits, adding that creating an increasingly dependent class will be like trying to solve one problem by creating a bigger one.

The revised personal income tax rates came into effect from 1 January onwards in a bid to increase government income. (NewsWire)

The post Eran reveals proposed minimum tax rate under SJB appeared first on Newswire.