By Sirisena Perera –
2009, immediately after the end of the war, President Rajapaksa appointed a ten-member Commission to study the country’s tax system and make recommendations to increase the revenues.
Three years have elapsed since then and another Budget is on the offing. The immediate motivation for the appointment of the 2009 Presidential Commission (the 4th since Independence ) was (1) the need to accelerate economic growth and (2) the need to arrest the decline of revenue. According to the Government Information Department, the Commission has been requested to cover all areas outlined by the President to improve the tax system in the country without placing burdens on the people.
The Commission has covered wide areas with regard to the taxation system in the country and has suggested measures to halt frequent changes to taxation.The Commission studied various taxes operational at different levels of Government and proposed ways and means to nationalize such taxes at national, provincial, and local authority level with the view to maximize revenue objectives at each level.The Commission was also to study Customs Tariff recognizing international trade agreements and propose necessary changes.
The International Monetary Foundation (IMF) which granted a US$ 2.6 billion loan to Sri Lanka has urged the government to take measures to broaden the tax base, simplify the tax and tariff systems, and improve tax administration.
Members of the Commission, Deputy Secretary to the Treasury Ministry of Finance and Planning Dr. R.H.S Samarathunga, Director General of Customs Sarath Jayatilleke, and Chairman Faculty of Taxation Institute of Charted Accountants of Sri Lanka Rajan Asiriwatham were also present.
The Chairman of the presidential Commission on Taxation 2009, Prof. W. D. Lakshman handed over the final report of the commission to President Mahinda Rajapaksa on Oct 26, 2010. Now we are getting ready for the 2013 Budget. What happened to this Report? It has not seen the day light. Has it been shelved and if so why?
The Government revenue continues to fall. It has been declining since 1977 from 24% of C G.D.P to the present level of 14%. If we are moving away from neo- liberalism, under Mahinda Chinthanya is there a drop in the decline of revenue?