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Budget highlights
| Public servants |
- Special allowance equivalent to five percent of basic salary,
effective from January 2011 CoL allowance increased by Rs 600 effective
from January 2011 (non staff grades) and July 2011 (staff grades)
- Pensions will be increased by Rs 750 per month for those retired
before January 1, 2004 and by Rs 250 per month for those who retried
between January 1, 2004 and December 31, 2005. This will be effective
from July 2011
- University academic staff and staff grade researchers in research
institutions will get monthly research allowance equivalent to 25
percent of their basic salary from January 2011
- Doctors’ on call allowance increased by 25 percent from January
2011
- Personal allowance of Members of the Judiciary under JSC increased
by 25 percent Professional and managerial level public servants to get
concessionary duty to import motor vehicles
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| Tax system |
- Current tax rates on personal income to be reduced to a range of
four to 24 percent, tax free threshold income increased to Rs 500,000
and tax slab also increased to Rs 500,000. PAYE tax will be deducted
only from employees earning over Rs 600,000 per year. Maximum tax rate
will be 25 percent.
- PAYE will be extended to the public sector. Terminal EPF benefits
exempted from tax. New employees pension fund
- New overseas employment fund
- New citizens’ pension and insurance fund
- Nation Building Tax reduced from three to two percent. Applicable
threshold fixed at Rs 500,000
- Social responsibility levy, rural infrastructure levy and debit tax
to be abolished
- Liquor, cigarette, casino taxes up by five percent
- Levy of US $ 20 per bed on all Five Star hotels which charge a room
rate less than US $ 125 per night effective January 2011
- VAT on financial services to be reduced from 20 to 12 percent
- Tax on profits of banking and financial institutions to be reduced
from 25 to 30 percent
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| Plantations |
- Smallholder tea growers subsidy increased by Rs 500,000 per ha
- Rs 500,000 million subsidy for tree planting and new planting,
inter cropping in the coconut sector
- Increased tree plantation subsidy for rubber A 50 percent subsidy
to popularize rain guards
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| Import-export and industry |
- CESS on exports in raw and semi process form.
- Finished goods exports free from such CESS.
- Duties and Taxes on machinery, equipment and raw material enabling
access to world class technology will be reduced.
- Tax reduction from 15 to 10 percent for industries with domestic
value addition in excess of 65 percent.
- Income tax of all export companies will be reduced from 15 to 12
percent.
- Income tax on profits to be reduced from 35 to 28 percent.
- Tax on tourism and related business income will be reduced from 15
to 12 percent
- Duties and taxes on passenger transportation vehicles to be reduced
by 25 percent
- Import of electric and high bred vehicles exempted from Excise tax
and VAT
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Agriculture |
- Seed farming investments get five
year tax exemption
- Rs 700 million for seed farm
development
- Farm gate price for liquid milk to be
increased to Rs 50 per litre
- North and East to produce 50 percent
of total fish production
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