Govt to eliminate regulatory duplication - FinMin

The government is taking steps to identify and help eliminate regulatory duplication, lessen compliance burdens and make it easier for businesses to interact with the government, thus alleviating unnecessary pressure on businesses, Finance Minister Ravi Karunanayake told members of the Chamber of Young Lankan Entrepreneurs (COYLE) at a seminar last week.

COYLE invited Minister Karunanayake to speak on a vital topic ‘Sri Lanka towards a Simplified Tax System’ and to draw attention to particular areas of concern where his advocacy would be beneficial.

The process will focus on four sectors including the Inland Revenue Dept., Customs, Excise and Levies and the reform initiatives will seek to broaden the taxable base, reduce tax rates and promote tax equity and economic growth in the economy, within the context of the economic reform program.

One classic case in point was the launch of the Customs ‘Single Window’ to ease import documentation and prevent corrupt practices, he said.

The need of the hour he said was higher tax compliance, tax restructuring, financial discipline and prudent spending to spur growth in the economy.

At the Q and A session, some of the issues brought up by members representing various sectors including vehicle imports, manufacturing, financial services and IT industry focused on; simplified VAT system, ETCA with India ramifications, FTA implications, Electronic payment system through PAYPAL for foreign remittances, upcoming revision of Capital Gains Taxation, limits for foreign investment by Sri Lankans, Net Metering system and its hiccups and Tax on Tax on imports.

The Minister assured COYLE of the Ministry’s assistance wherever necessary.

“Evidence-based information is vital to follow up with final recommendations of the Special Advisors. The Ministry would conduct a cost-benefit analysis to assess the impact on the economy for any changes to be implemented and help reduce the cumulative regulatory burden on businesses.,” he said.

Chairman of COYLE, Kasun Rajapaksa according to the statement issued by World Bank Vice President in charge of the South Asian Region, Annette Dixon, Sri Lanka has been rapidly achieving its development goals which were set at the time the loans were granted and that the financial discipline practiced by the government are the reasons for such achievements.

Chairman of State Affairs Sub Committee, Lalith Kahatapitya said, “At a time when taxation and costs of doing business in Sri Lanka are rising, the government must consider the impact these changes will have on competitiveness and effects on businesses, and that’s why it’s time to identify barriers to growth and recommend policies that will give businesses room to grow.”