Treasury bails out crisis-hit development lottery
View(s):The Treasury has bailed out the development lottery after a financial crisis that crippled transactions including the payment of Rs. 10,000 and above cash prices for the winners of the lottery when its bank accounts were frozen by the Inland Revenue Department (IRD) last week, officials said.
The IRD has, on several occasions, reminded the Development Lotteries Board (DLB) in writing, to pay the taxes but the board had said all funds were credited to President’s Fund.
The matter was resolved following discussions between Treasury Secretary, Dr. P.B. Jayasundera, acting Inland Revenue Commissioner General R.M.R.W. Manchanayake and other senior officials, he added.
Development lottery accounts at the Bank of Ceylon and People’s Bank were frozen due to non-payment of accumulated dues amounting to around Rs.3.5 billion for the period 2001 to 2009, IRD sources revealed.
As a result, the DLB had to withdraw 25 cheques of over Rs.10,000 each with five bouncing when lottery winners tried to encash them, Madhawa Dewasurendra, General Manager, DLB told the Business Times.
A sum of Rs.10 million was blocked in the past week as a result of the IRD action, he disclosed.
However, now the prize money has been paid to winners from daily collections and bank transactions have been normalised with the intervention of the Treasury.
Mr. Dewasurendra said that they cannot verify the actual amount due to the IRD as their officials have no records during the 8- year period from 2001.
The DLB has agreed to settle the accumulated tax dues in installments and the Treasury Secretary has given his consent for this purpose, he said adding that they will have to reach an agreement on the actual amount due to the IRD through consultation, compromise and consensus as the stipulated amount of Rs. 3.5 billion cannot be verified.