There is room for a potential revision of the VAT percentage & alleviate the tax burden as the economy stabilizes – President
Posted on February 8th, 2024

Courtesy Hru News

In his address to Parliament on Wednesday (Feb. 7), President Ranil Wickremesinghe unveiled the government’s agenda and shared that they hope to alleviate the tax burden on citizens as the economy stabilizes through the implementation of key economic reforms.

Highlighting the government’s commitment, President Wickremesinghe emphasized the potential for a revision of the Value-Added Tax (VAT) percentage, which recently rose from 15% to 18% at the beginning of 2024. Recognizing the strain this increase places on many individuals, he reassured that the government is actively addressing the issue.

Following the ceremonial opening of the Fifth Session of the Ninth Parliament, the Head of State presented the government’s policy statement to the House.

President Wickremesinghe highlighted a significant surge in tax registration, citing a rise from 437,547 in 2022 to 1,000,029 by the conclusion of 2023, marking an impressive 130% increase. He emphasized that as the tax network expands, the burden on both individuals and organizations will diminish accordingly.

Moreover, he pledged to enhance the benefits provided to the populace in tandem with the government’s increasing revenue. This commitment reflects the government’s proactive stance in addressing economic concerns and ensuring the welfare of its citizens.

“As government revenue increases, we will take measures to increase benefits for the people accordingly.

The tangible growth we are experiencing is evident in the current societal discussions. Not long ago, conversations centered around the challenges posed by power cuts, demanding uninterrupted electricity. Today, the discourse has shifted to electricity bills. Previously, concerns were raised about the exorbitant black market price of petrol, with talk of spending days in fuel queues. Now, the focus is on new oil companies investing in Sri Lanka. Issues related to the scarcity of vegetables have transformed into discussions about the prices of carrots. The prior scarcity of paper for book printing is now replaced by discussions about VAT.

Indeed, VAT poses a burden for many, and we are not oblivious to this fact. We are systematically addressing this issue. In 2022, there were 437,547 registered taxpayers, a number that surged to 1,000,029 by the end of 2023— an impressive 130 percent increase. As the tax network expands, the burden on individuals and organizations will diminish.

Continuing our economic reforms, we aim to alleviate the tax burden as the economy stabilizes. There is also room for a potential revision of the VAT percentage.” President

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