Development Budget with ‘election goodies’ thro’ Gazettes
The 2015 budget speech with a development outlook targeting the improvement of rural economy and infrastructure will be confined to highlighting the country’s current status of the economy, revenue and expenditure, proposals formulated to ensure development by creating more livelihood and employment opportunities, food security, energy security and environmental safety with particular emphasis on low income and poor families, official sources said.
The budget speech around 13 to 20 pages will highlight the government’s achievements and financial allocations for specific sectors of the economy focusing on the Medium Term Budgetary Framework 2015 – 2017. It will also explain how some of the fiscal and other measures are going to be implemented.
Last week, the Business Times reported that the budget would have ‘election goodies’ while taxes would be hidden in the annexures, so much so that Treasury Secretary P.B. Jayasundera, without naming the newspaper, told the Capital Markets conference on Thursday that the budget would be a development-oriented one (which it has always been) and no ‘election goodies’ as stated in a newspaper. But the moment the dust settled on the meeting, President Mahinda Rajapaksa announced a Rs. 250 reduction (through Gazette notification) in the price of gas. On Friday, the price of cigarettes was also increased by Rs. 2 per stick.
Treasury officials have now been called upon to concentrate more on a ‘Budget by Gazette’ with election goodies and these Gazette notifications being made public one after the other before and after the presentation of the 2015 budget which will not be a comprehensive one. More Gazettes are to unfold before the presidential election which is to be announced after consulting astrologers and presidential think tank (advisors), informed sources said.
In a similar move mid last month, retail prices of fuel were reduced and granted a 25 per cent reduction on the domestic electricity bill.
The introduction of 7 per cent non repayable VAT on vehicle imports reducing the current 12 per cent VAT by 5 per cent and further reduction of duty on hybrid cars and the increase of stamp duty of credit cards are some of the revenue proposals in the pipeline. With the aim of winning the confidence of rural voters, the 2015 budget will make some populist announcements including a new crackdown on tax evasion with punitive fines, revision of corporate tax, streamlining the revenue collection process and provide concessions for farmers, fishermen, self-employed and small businesses. With a drought affecting many farmers, the government will direct banks to suspend interest payments and delay loan recoveries under a special loan rescheduling scheme.
Under the initiative of protecting local producers and promoting import substitution, the commodity levy and cess on essential items, including maize, onions, potatoes and dairy products will be increased. Concessions will also be provided to improve the poultry industry encouraging exports.