Tuesday 22 September 2015

Sri Lanka brings back retrospective, telecom, small car importer tax

ECONOMYNEXT - Sri Lanka has re-introduced to parliament, a series of taxes including a controversial retrospective punitive tax and a levy aimed at hindering small car importers.

The administration elected in January was not able to pass the taxes as the then opposition did not support the taxes.

Opposition members at the time said the taxes amounted to taking vengeance on some companies including telecom companies and casino as firms perceived to have made 'ill-gotten' gain with the help of the last regime.

A tax on large 'mansions, changes to the value added tax, nation building tax was also tabled, to be taken up for a second reading tomorrow.

Opposition member Bandula Gunewardene said a debate was needed for the taxes.

Analysts warned that the retrospective taxes, and punitive taxes would hurt Sri Lanka's investment environment, just rule of law and open the door for the elected ruling class to wreak vengeance of other companies based on political connections.

Analysts say instead of using the taxation system to take back 'ill-gotten gains' those who made ill-gotten gains should be brought before the law.

Anura Kumara Dissanayake an opposition legislator said Avant Garde Security, a company which had made millions of dollars, apparently breaking the law was getting off scot free.

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