kinkfemdom

Sri Lanka Budget 2018 – Clean, lean and green budget’  Finance and Media Minister Mangala Samaraweera arriving to deliver his maiden budget speech  By Saman Indrajith

Sri Lanka Budget 2018 – Clean, lean and green budget’

Finance and Media Minister Mangala Samaraweera arriving to deliver his maiden budget speech

By Saman Indrajith

*A special tax on super luxury vehicles
*Rs. 10 excise duty per kilo on plastic resins
*An ‘open cage’ concept at the Dehiweala Zoo
*A cellular tower levy of Rs 200,000 per month
*Rs. 300 mn to promote IT and IT related sectors
*Alcohol volume based excise duty
*Issuance of new liquor license to be simplified
*NBT to be imposed on liquor, toddy not spared
*Sugar tax on sweetened beverages
*Rs. 1,400 million for Office of the Missing Persons
Rs. 1,250 mn for establishing medical faculties at Wayamba, Sabaragamu and Moratuwa Universities

The total government expenditure: Rs. 3, 001bn Budget deficit: Rs. 675 bn Expected govt revenue: Rs. 2,326 bn Expected expenditure: Rs. 3,982 bn

Samaraweera proposed a reduction of taxes on the importation of electric vehicles including electric three wheelers, cars and buses while rationalising the import taxes on vehicles powered by fossil fuel. The new formula for import taxes would be based on the engine capacity which will minimize the revenue leakages, he said.

The minister proposed a carbon tax on motor vehicles based on engine capacity.

The import taxes on an electric car would be reduced by at least one million rupees while the import tax on the high end fossil fueled cars would be increased by almost Rs 2.5 million. “We will impose a special tax on super luxury vehicles with an engine capacity exceeding 2500 cc. At the same time the import taxes on a diesel three wheeler will be increased by around Rs. 50,000 to encourage the tansfer into environmentally friendly electric three wheelers.”

The government plans to introduce a project to transform the public transport system by introducing 50 electric buses to the SLTB fleet at a cost of Rs 500 million.

“To discourage the use of polythene and plastic products, we will impose an excise duty of Rs 10 per kilo for plastic resins” Minister samaraweera said.

Customs duties would be removed on all machinery, equipment, raw materials and intermediary goods used in manufacturing bio degradable packaging material.

It was proposed to allocate Rs 75 million to move away from the caged zoo concept to an ‘open cage’ concept at the Dehiwala Zoo. Pinnawala Elephant Orphanage would be reorgniazed to be ‘born free chain free’.

“The proliferation of cellualr towers is both and environmental and health hazard,” Minister Samaraweera said. “As such we will impose a cellular tower levy of Rs. 200,000 per tower per month to discourage the construction of such towers.

The Minister proposed to allocate Rs. 3,000 million to introduce an insurance scheme for the farmers who are vulnerable to face natural disasters. The insurance cover would be minimum of Rs 40,000 per acre for six crops namely paddy, maize, soya, big onion, potato and chilli.

The government would bear 50 percent of the cost of introducing technology such as refrigerated storage to mitigate post harvest losses in multiday craft. The government would also bear 50 percent of the cost of multi-day boats which were more than 55 feet long to encourage deep sea fishing, he said.

Samaraweera proposed to allocate Rs. 300 million to promote IT and allied sectors with the potential to yield USD 5 billion in revenue within the next five years.

A proposed duty of five rupees will be imposed per litre of toddy while Rs.10 will be imposed per kilo on Molasses/Maize/Rice/Fruits.

The Excise (Special Provisions) duty applicable on canned beer will be removed.

The rate structure of liquor licence fee will be simplified with effect from January 01, 2018.

The issuance of new liquor license will be simplified to promote tourism, the minister said in proposals.

The minister said that out of the total liquor consumption, almost 49% was from illicit sources while 85% drinkers consumed hard liquor.

“However, in most countries, the tax structure is designed to discourage the consumption of hard liquor and is often proportionate to the alcohol content. We will rationalise the tax structure based on a formula linked to the alcohol content and type,” he said.

Further, he added that NBT would be imposed on liquor with effect from April 01, 2018.

The minister also announced a sugar tax on sweetened beverages. Excise duty based on the quantum of sugar contained will be introduced for the beverages with added sugar.

This duty is applicable for beverages classified under HS Code 22.02. The rate will be 50 cts per gram of sugar.

Minister Samaraweera proposed to allocate Rs. 1,250 million to set up medical faculties at the universities of Wayamba, Sabaragamuwa and Moratuwa. He proposed to increase the eligibility criteria of the household income threshold from Rs. 300,000 to Rs. 500,000 per annum for the Mahapola scholarship scheme. This would benefit an extra 3,000 students, he said.

Samaraweera proposed to allocate Rs. 440 million to upgrade the Police Informaiton and Communication Systems to meet the modern day demands including facing the cyber crime threat.

“In the early 1990s , all Muslims living in the North were forcibly evicted by the LTTE. Since then, many of them have been living as Internally Displaced People. Rs. 2,500 million will be allocated for infrastructure development and housing for these displaced persons. Funds will be allocated to expedite the resettlement processes which include the rehabilitation of the Mannar town area and to continue the township development programme at Silawathura.” Minister Samaraweera proposed to allocate Rs. 1,400 million to commence the operations of the Office of the Missing Persons.

Samaraweera said Rs. 1,250 mn would be allocated for establishing medical faculties at Wayamba, Sabaragamu and Moratuwa universities. The state universities would offer internal off-site degree programmes in properly regulated and accredited private institutions, he added.

The Minister in his conclusion said: “I want to say that at the heart of the ensuing debate in the coming 26 days will lie, not only the question of Economic Development, but also the question of values. We will talk about values that should shape our country and determine our children’s future. On one side of the debate indivisibility of our great nation, rights and dignity for all, rule of law, strong institutions, economic prosperity built on strong foundation of democracy and reconciliation. Some others, on the other hand, will speak about values based on fear, suspicion, mistrust, bigotry and intolerance … we are at the crossroads of history. Are we to walk forward, united in our diversity to a new age of freedom and prosperity or are we to go back to the darkness of a bygone era? The choice is ours to make.”

It was Minister Samaraweera’s maiden budget as the Finance Minister, the 72nd budget of the post-Independence Sri Lanka and the fourth budget of the incumbent government.

Yesterday’s presenting of budget proposals is considered the second reading of the appropriation bill presented to parliament by State Finance Minister Eran Wickramaratne on Oct. 09. Second reading debate of the budget, scheduled to commence today will continue till Nov. 16. The vote on the second reading debate is scheduled to be taken on Nov. 16 evening. Third reading debate will continue from Nov. 17 to Dec. 09. The final vote on the budget is scheduled for Dec. 09.

The total government expenditure has been estimated at Rs. 3, 001 billion for the next year. The budget deficit for 2018 is Rs 675 billion which is proposed to cover from foreign borrowing and domestic financing. Expected government revenue including grants is to be about Rs. 2,326 billion and its expenditure Rs. 3,982 billion.

No Comments

Leave a Comment