Aug 24, Colombo: Sri Lanka's President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe will unveil the economic development plan for the next eight years, Vision-2025 on 4th September in Colombo, State Minister of Finance Eran Wickramaratne said.
State Minister Wickramaratne made these comments at a press briefing held today (24th Aug.) at the Department of Government Information to discuss about the new Inland Revenue Bill which is to be presented in Parliament on Friday (25th Aug).
State Minister Wickramaratne said that in the past, concessions were given in an ad hoc manner. Now the government wants to create social equality.
Therefore, the government would gradually reduce the indirect taxes to 60 percent from the current 80 percent and increase the direct taxes from 20 to 40 percent. He said that in countries such as Malaysia the indirect tax is 30 percent while the direct tax is 70 percent.
The Minister pointed out that the new indirect to direct tax ratio will provide relief to middle and low income earners. He said that indirect taxes will be reduced within the next three to four years.
According to the existing tax system, taxes are levied on income above Rs. 62500 per month and under the new act the limit will be raised to Rs. 100,000. Incomes below Rs. 1.2 million per year will not be taxed.
The State Minister insisted that the new Inland Revenue Bill would not affect the private sector retirement fund, Employee Provident Fund (EPF). He also added that the new act will be simple, transparent and will reduce the decision making power as everything will be specified.
According to the Supreme Court ruling, the new tax bill has been amended and the trade union representatives' proposals and other proposals have been considered.