NCCISL hails budget benefits for SMEs

Ramani Kangaraarachchi

This year’s budget has laid the foundation for real investments, NCCISL President Asoka Hettigoda said. The National Chamber of Commerce and Industries (NCCISL) has recognized it as steps towards achieving the targeted development of the country.

He said the budget focuses on domestic industrial development, export promotion and import replacement as well as providing tax incentives to selected thrust areas such as tourism, agriculture, and animal husbandry. The special incentives given to SMEs are noteworthy whilst giving a boost to improve skills development, branding and new product development. Manufacturing certain items in Sri Lanka will give local companies to produce for the local market. He commended the reduction of income tax rate of 12 percent given to the tea manufacturer enters into joint ventures with branded tea exporters which will add value creating more Sri Lankan brands in the international market.

The concessions granted to the SME sector by reducing the investment threshold to Rs 25 mn with a four year holiday which will encourage new SMEs developing the rural economy was appreciated by the Chamber. He said setting up of SME Bank units by State Banks in each district will alleviate the longstanding issue of access to funding by the SMEs.

Hettigoda commended that for the first time a triple deduction is offered to research conducted with State Institutions which is needed to stay competitive in the global market. Further, reduction of income tax for Rand D companies to 20 percent will encourage new entities to enter into this unchartered area.