JO alleges VAT Bill presented for second time in irregular manner
Posted on October 5th, 2016

By Saman Indrajith Courtesy The Island

The Value Added Tax (Amendment) Bill was presented to Parliament yesterday by Leader of the House Minister Lakshman Kiriella amidst concerns from Opposition lawmakers that for the second time the Bill had been presented in an irregular manner

Soon after the Bill was presented, UPFA (Joint Opposition Group) MP Bandula Gunawardena pointed out that the Bill had been published in the gazette before it got Cabinet approval.

He said the proper procedure was to get Cabinet approval before it was published in the gazette.  “The Bill received Cabinet approval on September 12 but the gazette was issued on September 9,” he said.

State Minister of Finance Lakshman Yapa Abeywardena said the Ministry had got an opinion from the Attorney General on the matter and the report would be given to Parliament tomorrow.

Speaker Karu Jayasuriya said if there was a dispute, the Bill could be challenged in Court. “I will accept the State Minister’s position,” he said.

This is the second time the Bill is being presented to the House. The Supreme Court ruled in early August that the previous Bill presented by the Minister to the House lacked Cabinet approval and, therefore, it was not consistent with the Constitution.

The new Bill, approved by the Cabinet on September 12, includes several amendments to the Bill previously presented to the House.   In terms of the new bill, VAT will be charged at 15 percent.

The imposition of VAT applies, among others, to wholesale and retail trade if the threshold is more than Rs. 50 million a year or Rs. 12.5 million a quarter. The new rate will also be imposed on private health services other than diagnostic tests, dialysis, and OPD services. It will also apply to channeling consultation, telecommunication services, tobacco products and powdered milk which contain added sugar or other sweetening matter.

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