PARLIAMENT

‘Seven amendment Bills aim at economic development’

Sandasen Marasinghe, Irangika Range and Disna Mudalige

Speaker Chamal Rajapaksa presided when parliament met yesterday at 9.30 am. After the presentation of papers and oral questions, the House took up the Value Added Tax (Amendment) Bill, Nation Building Tax (Amendment) Bill, Finance Bill, Betting and Gaming Levy (Amendment) Bill, Tax Appeal Commission (Amendment) Bill, Fiscal Management (Responsibility) (Amendment) Bill and Strategic Development Projects (Amendment) Bill for debate.

Finance and Planning Deputy Minister Dr Sarath Amunugama:

These amendments were presented with the 2013 budget moved by President Mahinda Rajapaksa in his capacity as the Finance and Planning Minister. The national economy would be promoted through these amendments.

Imposing new taxes and offering tax reliefs are based on the development needs of the country. We have given top priority to promote investment utilizing our resources in a proper manner and encouraging management when we prepared these amendments. We have

proposed many tax reliefs to emerging industries such as construction, tourism and betting and gaming. Infrastructure facilities are expected to be further developed through tax reliefs on the construction industry. Goods and equipment imports necessary for waste management and disposing have been given tax concessions.

We expect that the environment of the country would be more beautified and cleaned with these proposals in future.

Ravi Karunanayake (UNP):

When roads are developed eightfold, expenditure is also increased. Poor people’s money is used for them. It is a burden to the people. Corruption is rampant all over the country. Why is the government unable to eliminate these corruptions? It is useless developing the country unless bribery and corruption are eradicated.

The income of the country has declined by 11.5 percent of the GDP. Where has this money gone? Much expenditure is unwanted. Financial mismanagement of this regime is high. As the Opposition, it is our duty to point out these faults. It is the duty of the government to heed and rectify them. The economy of the country should not be put into trouble. The government is involved in promoting gaming and betting. New casinos, taverns and brothels are being opened. The Opposition is looking at problems in a national perspective. We are not here to safeguard the inefficient government, but to safeguard the interests of people.

Disaster Management Minister Mahinda Amaraweera:

The government has to properly manage taxes and find means to increase the tax income. The government is attempting to increase the tax revenue in a manner that the public are not affected by that. During the UNP regime, it introduced a Tax Amnesty Bill and it deprived a large sum of money to the country.

The government has increased taxes charged from casinos and taverns, while maintaining subsidies for farmers and fishermen. None of the subsidies given to the people have been curtailed by the government.

It is true there would not be immediate benefits from large scale development projects. But the dividends of those projects will surely come in the years to come. That is the nature of large scale projects. Those have long-term benefits. Highways would attract more investments to the country.

The tax policy should be simplified further. We have to take steps to increase the number of tax payers. Benefits given to tax payers should be increased and they should be appreciated as an encouragement.

M.A. Sumanthiran (TNA):

The announcement that the Bills that were directed to the Supreme Court are constitutional according to the Supreme Court determination is nothing surprising considering the fact that the Judiciary is under the thumb of the Executive.

We must have development, but that development should be sustainable and people’s development. It should contribute to the reduction of the debt burden of the country. The government’s desire to borrow more is seen when analyzing amendments.

Betting and gaming are illegal trades, but we prescribe taxes from them and this is not a good example.

Deputy Chairman of Committees Chandrakumar Murugesu takes the Chair.

A.H.M. Azwer (UPFA):

The amendments brought today envisage an economic revival in the country. We are striving to build a contented nation, after the conclusion of the 30 year war. The government is inviting the TNA to initiate talks. The proper procedure to solve problems is through the Parliamentary Select Committee. But the TNA refuses to participate in the PSC process and shedding crocodile tears on Tamils.

Sunil Handunnetti (DNA):

The Finance Ministry was unable to present these Bills to the House in the proper manner. The government has disregarded the privileges of MPs. How can we debate these amendments, when they were submitted at the last moment? We will not extend our support to pass these amendments. The government has planned to sell all valuable lands to foreign individuals. That is why these amendments were brought to Parliament today. You have opened the doors for large scale casino operators to the country by giving tax concessions through these amendments.

J.R.P. Suriyapperuma (UPFA):

The entire world has been adversely affected by the financial crisis. But, we have been able to secure a strong economic growth despite all these negative aspects. Many foreign countries like Spain, Cyprus and Italy are in doldrums today.

The People of those countries are suffering. The USA is also in bankruptcy. Today, those elements are trying to interfere into other countries which are emerging as strong nations. We are not scared of the USA and its allies.

Dr. Harsha de Silva (UNP):

Today, people are facing difficulties due to the high cost of living. The government is going to place an extra burden on the people by increasing fuel prices and electricity bills. The government while talking about the protection of ethical and cultural values, on the other hand, has given tax reliefs on the casino business. But the percentage of taxes imposed on the electricity bill has been increased placing burdens on the people. Tax concessions should be given to the people of the country and not to large scale businessmen.

Education Minister Bandula Gunawardena:

Parliamentarians should be extra cautious in their behaviour in parliament. The speeches they make in public rallies should not be made in this chamber. Our seniors have provided us with examples on the way we have to speak in the House.

Wrong analysis on the Grade 5 Scholarship exam results in the Southern Province was presented by UNP MP Ravi Karunanayake. He said 34,000 students out of the 39,000 students who sat for the exam had failed.

This is incorrect. In the Southern Province, 38,976 students sat for the grade 5 scholarship exam and 26,884 among them had passed. As a percentage, this is 69 percent. The false statement is a disgrace to the Southern Province which has produced bright students.

According to the ‘World Development Indicators’ report published by the Word Bank, the state income of Sri Lanka as a percentage of the GDP is 14.9 percent, whereas the state expenditure as a percentage of the GDP is 19.2 percent.

We need to raise the state revenue at least up to 25 percent of the GDP to manage our economy properly. The government is attempting to do this in a manner that has a least effect on the people.

Janaka Bandara takes the Chair.

D M Swaminadan (UNP):

Sri Lanka should deal with the international problems it has confronted with. The External Affairs Minister said they do not accept the resolution of the UNHRC on Sri Lanka. That might be the government position. But there are many other problems attached to it. The holding of Commonwealth Heads of Government Meeting in Sri Lanka in November has become problematic and several leaders including the Canadian Prime Minister are to boycott it, if there is no progress in the country on human rights sphere. Sri Lanka cannot survive all alone.

Shantha Bandara (UPFA):

Taxing is essential to take the economy forward. While simplifying the tax policy and providing tax concessions for needy sectors, we have to find means to increase the tax revenue.

Casinos are aimed at the tourist industry. We have to provide for the needs of tourists while maintaining our cultural values. The government’s policy is to reduce liquor consumption. Many programmes have been initiated to cater to this goal.

Even under the proposed electricity tariff hike, the government will provide concessions up to Rs 12,000 million. The concession for religious places would be increased from Rs 1,000 million to Rs 1,200 million.

Gayantha Karunathilake (UNP):

The people are affected by excessive taxing. The tax burden on the people is unbeatable. This situation is only second to the period of colonialism where taxes were imposed for even having pets. The government says these Bills are introduced for the well being of the country. But in reality, those are to rob the people’s money.

Social Services Minister Felix Perera:

We obtain loans for development activities. The dividends of them may not come immediately. But those are useful investments for the future. The agro-economy is strong today. The fertilizer subsidy has contributed to this achievement.

We have given tax concessions to the tourism industry since it has become a biggest revenue earning method in the country. Tourist arrivals have been increased in our country compared with other countries. Hotels across the country are fully occupied with tourists.

It is reported the occupancy rate of tourists is around 86 percent everyday in hotels while it exceeds 95 percent during seasons.

Ajith P. Perera (UNP):

The government wants to create this country as a hub of Casino in the world. That is why it wants to give tax concessions to Casino businessmen. The objective of the government is to make the country attract to the Casino business. The government which promised to create Sri Lanka as an island of Dhamma, has taken measures to convert it into a Casino island.

Health Deputy Minister Lalith Dissanayake:

The government has carried out mega development activities with the aim of converting Sri Lanka into a best economic hub in the world. A number of industrial, tourism and export zones will be established to fulfill this target. The government’s policies are based on the Mahinda Chinthana future vision. Today, we are heading forwards prosperity after the war. The government has given priority to the development of local productivity. Tax holidays will be provided with the aim promoting local productivity while encouraging foreign investments.

The Bills were passed with amendments.

The House was adjourned until 9.30 am today.