Revenue Management Authority to boost tax collection and end corruption
The government is planning to set up a separate Revenue Management Authority to minimise corruption and financial leakage in the process of tax collection of the Inland Revenue Department (IRD) and Sri Lanka Customs, official sources disclosed.
Measures will be taken to draft a new bill to set up the authority with powers of a Directorate of Revenue or to amend the Inland Revenue Act with a view of separating revenue management and tax administration of the two key state revenue collection institutions.
Sri Lanka needs to improve its tax revenue to ensure that the government has enough money to spend towards welfare and growth while not running the risks of high budget deficits and debt levels.
This has become an extremely difficult task as tax evasion has become the order of the day with many billionaire businessmen, rich men with high political connections and even professionals are allowed to escape from the tax net by dozens of corrupt officials in the two departments.
Details of these officials and tax evaders have made known to the government in a special report of the intelligence divisions.
Chairman of the Inland Revenue Commissioners Association and senior commissioner Sarath Abeyratne told the Business Times that their association is ready to expose these top corrupt officials, other rankers, persons with high political connections and some of the so-called tax consultants.
The association is planning to meet President Ranil Wickremesinghe to reveal all the details of corrupt practices in the department which has resulted in billions of rupee loss of tax money for the country coffers.
The government should accord immediate priority to take stern action against such perpetrators rather than focusing attention only on the setting up of the Authority, he said adding that he cannot comment on the proposed Authority which is still to materialise.
The government has foregone massive amount of over Rs.515.15 billion during the past six years due to tax avoidance by several companies and the department is still continuing the recovery process and legal procedures against those tax evaders.
“These tax evaders were making use of the loopholes in the tax net specially, regulations, taxation complexity, weakness in tax administration as well as official collection procedures and corruption,” he said.
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