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The signing of the permanent ceasefire between the UNF Government and the LTTE is the first step on the road to national peace and economic revival.

The maiden budget of the UNF government has closely examined the basic reforms necessary for a growth oriented economy based on partnership with the private sector. In this regard active discussions have been held with the Chambers, both trade and industry and also with the IMF and the World Bank. We welcome, that the state should be the facilitator and the private sector the developer of the economy. The UNF government has placed confidence in the private sector, because it is the honest and sure path in rebuilding our economy, the Chamber said in a press release.

The budget indicates the immediate measures necessary to revive the economy and increase productivity and employment - state lands to be released in greater Colombo, Moratuwa for property and other development to private enterprises. We welcome this move, as the land and buildings of the state we had been given for the industrial incubator is still hanging fire. The transfer has taken over 18 months and is still incomplete, it said.

As tax payers, we the small and the medium sector of the industry face a whole host of different taxes. We welcome the abololishing the GST, NSL, Corporate tax surcharge of 20% and the tax on capital gains. The Government to recognise tax payers who honour their tax commitments is encouraging.

To set up a permanent Tariff Commission which will be a mechanism to examine tariffs and address representations made by industrialists. Tariff commission existed a couple of years ago, but was abolished and its re-introduction is a boon to the industrial sector.

The reduction of the surcharge on import duty to 20%, will certainly bring down the costs of imported goods, and abolishing same in 2003 is a silver lining to most of us, especially since food items will be available at affordable prices for the middle income group. The tax exemption threshold which has been raised to Rs. 240,000 per annum is what the Chamber has been agitating for a long time. We praise the UNF Government for their due consideration in this regard.

De-regulation is a pressing necessity. This was explored recently at a joint conference between the private sector and the state. Many unmeaningful administrative requirements were identified. The budget gives an assurance that these will be done away with. The people who participate in these conferences go back to their business and carry on as before. We welcome the Government embarking on the main areas of de-regulation, with customs tariff, tax administration, labour and land titles.

Early amendments to the Industrial Dispute Act and termination of the Employment Act is what the industrial sector has been requesting from governments. We welcome a schedule of specified compensation payable on termination of services equitable by both the employer and employee. We welcome the Minister's move of exempting interest income of Rs. 600,000 and less per annum, as the Chamber depended on this income for its day to day operations. The Chamber in the recent past has made repeated appeals to the previous Government regarding this cause, the Chamber said.

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