UNP and SLFP join hands to present moderate budget
The Sri Lankan government has begun preparations for a moderate budget for 2017 incorporating two sets of proposals to be put forward by the Sri Lanka Freedom Party (SLFP) and the United National Party (UNP) ministerial committees. President Maithripala Sirisena has appointed a committee headed by Minister Dr. Sarath Amunugama to draft the set of budget proposals of the SLFP while the UNP will submit a separate set of proposals, official sources disclosed.
The President has also directed SLFP ministers to closely monitor the budget preparation process, sources said adding that the budget will introduce a rational and effective taxation system minimizing tax evasion and high income receivers and enhance the collection to 20 per cent of GDP by 2020. The aim is to ease the economic burden of the common people and reduce indirect taxes for the benefit of the poorest of the poor.
The UNP’S focus would be to create 1 million jobs, increase income, rural economic development and affirmation of land ownership which are the mid-term targets of the government. The 2017 budget is to reinstate the discipline of public finance with the principles of ‘transparency’ and ‘accountability’. Treasury funds are being dried up and it’s essential to collect taxes and duties and more borrowings even to meet the day to day expenses and debt repayments, a senior official said.
The government has accorded priority to tackle the challenges of attracting foreign investment on new trends of global economy, and expanding foreign trade, improvement of economic growth by increasing public income and reducing expenses.
Major policy changes are to be introduced through the budget to attract private sector to engage in productive activities enabling the government to tax their economic outcomes.
The budget is being formulated to achieve an economic growth of 6 per cent and maintain a budget deficit of 4.7 per cent of the GDP, down from a targeted 5.4 percent this year, in line with targets agreed with the International Monetary Fund (IMF), the official said. Under a programme agreed with the IMF, Sri Lanka is expecting to increase revenue and grants to 14 per cent of GDP in 2017 from 13 per cent in 2016.
The budget will also put forward solutions to minimise the public sector debt burden and provide appropriate proposals to accelerate private sector investment. The current practice of government undertaking everything through debt-related investments is to be curtailed by taking pragmatic economic policy measures to create public-private partnership towards productive economy while enhancing revenue base and controlling borrowing habit, he revealed.