MR’s call on proposed Income Tax law
Posted on August 27th, 2017

TILAKARATNE RANAWEERA

According to a news Item in the print media, former President Rajapaksa has advised all SLFP MPs not to vote for the Income Tax Bill. My humble thinking is that he is more than correct! Not only his Party, the JO emphatically, and no MP should vote for this draconian Bill, if he/she aspires to become an MP once again

If he is correct, this Bill is simply suicidal! The Finance Minister compares the direct to indirect Tax ratios of other countries around us, but he does not talk or think of the recent history of our country, which was devastated due to a brutal war for 30 years, whereas other countries have not suffered like us. They were able to develop with citizens taking a fair share, with peace prevailing. In Sri Lanka when people are trying to raise their heads with much difficulty, is it not lunacy to tax them more and more? What the Government must do is to cut their lavish living styles, reduce Cabinet Portfolios and reduce non-productive expenditure. What our ‘intelligent’ Finance Minister and his advisory team should do to reduce this imbalance in direct and indirect tax ratios, is to increase the “Tax base” and not burden with more and more taxes those who are already genuinely paying their taxes.

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They should include tens of thousands of the rich class of people presently not paying tax at all. Ill gotten wealth is clearly seen with the tens of thousands of very expensive cars moving all over the Island!

This Government came to power with the blessings of the middle and lower middle income groups assisted by religious dignitaries, professionals such lawyers, doctors, engineers, University Academics etc, and those people who valued freedom and democracy.

I/R Bill, if passed in the Parliament, will affect many of those who voted for the Government and those who are currently paying Income Tax genuinely, from their legitimate earnings. Notably a large number of professionals, and those who returned to the Island after serving many a hard years abroad and saved some dollars and invested on agriculture, housing, small and medium scale business ventures etc. are all hit by this Bill, as correctly pointed out by the former President.

‘Withholding Tax from the rental income will cause immense hardship to middle class people trying to supplement their income by renting out properties’. The result would be that no one would build an extra house for renting out, even if they have spare cash. It would be a policy that only one house can be kept for one family. When it comes to the income drawn by religious places, the only income exempted are funds utilized for the care of elderly people or disabled! How about the funds needed for the development and upkeep of temples and churches? Honestly, this is a ludicrous situation and shows the delirium inflicted on Yahapalanaya by those who are foreign to the subject.

As I see it, this is a piece of legislation that discourages people to invest, especially in the Small and Medium Sectors, that discourages professionals to return from overseas, and encourages professionals to seek employment abroad, the brain drain as pointed out by GMOA. This Bill is an illusionary attempt by the Government to fatten the State coffers with severe hardships inflicted on its people, with no forward thoughts in the horizon!

TILAKARATNE RANAWEERA

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