Budget thrust on development, welfare, local industry
Uditha Kumarasinghe Irangika Range and Sandasen
Marasinghe
VAT reduced to 12 per cent from 15 per cent
Ranaviru allowance increased upto Rs.5,000
Government servants Cost of Living rises to
Rs.4,500
Pensioners to get extra Rs.560
Fertiliser subsidy to continue
Relief for electricity, water consumers
Cess on fridges, fans increased
Allowance for Samurdhi children
Kotte: President Mahinda Rajapaksa yesterday presented the fourth
budget of his Government introducing a wide range of people’s friendly
proposals aiming to bring down the cost of living burden and achieving
long term economic benefits to the country including the development of
local industries.
President Rajapaksa presenting his budget introduced proposals to
immediately bring down the fuel prices, as widely expected by the
public. The President said consideration will be given to make another
reduction of fuel in the forthcoming months, if international oil prices
stabilise at a lower level.
“The objectives of my proposals was to give every possible relief,
that would benefit a majority of the society. Through the reduction of
fuel prices, transport fares, electricity and water tariff, VAT and
income tax and with the enhanced cost-of-living allowance granted to
public servants and pensioners, the working class has been given greater
relief.”
He proposed additional cess on imports of many items including
refrigerators and garments to discourage imports and encourage local
manufacture. “Our policy is to encourage local producers and production.
As such, imposition of Cess, introduction of loan schemes and extension
services were done to promote local production.”
“Mahinda Chinthana, Ten Year Horizon Development Framework is being
widely implemented across the country. The humanitarian operation to
relieve the country from the grip of terrorism has reached its final
phase.
A democratic environment for a political solution in which the power
of all people will be amply strengthened is emerging,” the President
said, commencing the Budget speech.
Referring to the economy, he said the country’s GDP has grown by an
average of seven percent. The per capita income which was US$ 1,000 in
2004 increased to US$ 2,000 this year. Unemployment was reduced to
500,000 from 800,000. We generated 300,000 new job opportunities. The
rural income thereby increased since those who benefited most through
these new job opportunities were the youth of such areas.
“We have taken measures to improve Government revenue which was Rs.
331 Billion in 2004 to Rs. 712 Billion this year. Revenue from Income
Tax has registered a record improvement of Rs. 143 Billion. This is a
favourable trend. We have managed to maintain a Revenue/GDP ratio of 16
per cent. This is despite many concessions provided for oil, essential
commodities, raw material and investments,” he added.
As per Budget 2009, the reduction of the price of petrol will pass a
benefit of around Rs.500 per month to over 1.6 million motorcycle users
and Rs.1,200 to Rs.2,000 saving to all three wheeler and vehicle owners.
The budget has also taken measures to reduce the electricity tariff with
special attention to industries and the tourism sector due to come down
price of furnace oil used for power generation.
The President presenting his budget speech introduced a series of
measures for the welfare of the public servants. The budget has
increased the cost of living allowance paid to the public servants up to
Rs.4,500 with effect from January next year.
An additional provision of Rs.12,000 million has been allocated for
this purpose. In addition, the budget has allocated Rs.3,000 million to
rectify the salary anomalies in services such as judicial service,
teachers service and principles service.
The budget has also proposed to increase the present Rs.3,000
festival advance available to public servants to Rs.5,000. The budget
has also increased the Rs.1,000 advance paid to public servants to
purchase school books for their children to Rs.2,500.
In order to reduce the cost of living burden on the pensioners,
Rs.1,440 cost of living allowance introduced to pensioners has been
increased to Rs.2000 with a monthly increase of Rs.560.
Initiatives have also been taken by the budget to pay Rs.500 monthly
incentive to the public servants who retire prior to becoming entitled
to receive a pension. An additional allocation of Rs.3,000 million has
been made for this purpose.
The President in his budget speech paying the highest tribute to
soldiers by proposing to increase the monthly allowance to Rs.5,000. A
sum of Rs.4,500 million has been allocated for this purpose.
The budget has also proposed to allocate Rs.3,500 million to commence
the construction of few more Ranaviru Gammana with all facilities during
the next year.
More than 350,000 electricity consumers and 150,000 water consumers
will benefit from relief proposals in the Budget. Budget has allocated
Rs.300 million for this relief.
The budget has proposed to give a monthly allowance of Rs.200 for the
children between the ages of 1 to 5 of Samurdhi and low income estate
families to reduce the cost of living of such families and promote the
liquid milk consumption among their children. Rs.900 million has been
allocated for this purpose.
The President in his budget also proposed to impose a Nation Building
Tax as a social contribution towards the welfare of security forces and
to rebuild communities and infrastructure facilities affected by
terrorism.
In order to further encourage the local dairy farmers, the budget has
increased the special commodity levy on imported milk powder imports
from Rs.5 to Rs.15 per Kilo.e special commodity levy on imported sugar
from Rs.14 to Rs.16 per Kilo to encourage the local sugar industry and
sugar cane cultivation.
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