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Consumers get no relief from tax hike suspension
Millions of consumers have been forced to fork out different 2016 budget levies though they remain suspended.
These include increases in the Value Added Tax and the Nation Building Tax. President Maithripala Sirisena directed Finance Ministry Secretary R.H.S. Samaratunga to suspend these increases in the levies. This was after it was brought to his attention that the imposition of increased taxes impacted on most essential consumer items and this raised living costs.
However, hotels and restaurants that had increased the prices of rice-and-curry meals have not reduced them, after the taxes were suspended. Only supermarkets and recognised retail outlets which programmed their cash registers to reflect the increase in taxes have changed the prices after the suspension of the increase in taxes.
An Inland Revenue Department (IRD) official said yesterday that companies which paid up the taxes during that period would be given an adjustment, but there were practical difficulties in tracking consumers who had indirectly paid the taxes.
He said they had sought a directive from the Finance Ministry on this issue.
Among the sectors which have passed the taxes on to the customers are hotels, hospitals, taxis and entertainment businesses. Traders have included the tax on a range of goods sold by them. IRD sources said that the benbenefit of the suspension of the two taxes would go to the companies as they would be entitled to an adjustment, but not the consumers.