Revenue mobilisation efforts underway
View(s):By Bandula Sirimanna
The Government has taken fiscal consolidation measures under the revenue mobilisation strategies to ensure that adequate financing is available for the investments in public services and social programmes.
Funding is to be made for education, healthcare, transportation and public safety, infrastructure and welfare programmes, unemployment benefits, and support for vulnerable segments of society including the elderly, disabled, and low-income families.
The government will be passing some new taxes and tax revisions in parliament by presenting it as an Inland Revenue Amendment Bill within the next two months for such public financing, a Finance Ministry official said.
The government will enforce much delayed wealth tax to further improve tax collections from large taxpayers, and the completion of risk profiling of the largest 100 High Wealth Individuals (HWI) taxpayers by September 2024, he disclosed.
The Inland Revenue Department is to solicit, information from 100 profiled HWI taxpayers via questionnaire by end-December 2024, he added.
The government has already obtained cabinet approval of the revenue measures which will be submitted to Parliament by end-June 2024 for parliamentary approval by end-July 2024.
The implementation of a VAT compliance improvement programme will be prioritised in 2025 to detect and deter noncompliance. The overall efficiency of our VAT system remains low and its compliance remains weak, he revealed.
The government will remove the corporate tax (CIT) exemption on the export of services, and increase the CIT rate on betting and gaming, tobacco and liquor industries to 45 per cent from 40. It has been proposed to increase the stamp duties on lease contracts to 0.2 per cent from 0.1 per cent.
Tax policy measures are expected to yield at least 1.2 per cent of GDP and to raise about 0.8 per cent of GDP from the lifting of import restrictions on motor vehicles in 2025.
If the yield from these measures does not fully materialise, the government is committed to adopt additional measures to compensate for the shortfall, the official said.
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