Inland Revenue (Amendment) Bill

‘UNP has no right to talk about independence of judiciary and judges’

Parliament met at 9.30 a.m. September 24, 1998, with Speaker K. B. Ratnayake in the chair.

After announcements were made and petitions and reports were presented and Ministers answered oral questions, House resumed debate on Inland Revenue (Amendment) Bill.

Minister of Justice, Constitutional Affairs, Ethnic Affairs and National Integration and Deputy Minister of Finance Prof. G. L. Peiris said: The primary aim of the amendment is to give effect to the proposals of the 1998 Budget.

During the period between the last budget speech and now a vast amount of work has been accomplished by the government.

The other day Transport Minister told me that he had been able to construct 700 bridges. The largest was the Alawwa bridge.

The tax concessions given to Unit Trusts ended on March 31, 1998. After this Unit Trusts becomes liable to a 35 percent income tax. We believe that this has been a great disincentive.

Therefore we now seek to give income tax exemption to Unit Trusts which distribute 70 percent of their profits to the shareholders.

The Amendment Bill also provide for the exemption the payments to persons who are retiring voluntarily. At the moment there is no such provision.

Companies investing a minimum of Rs. 4 million and employs a minimum of 50 employees will be given a 5 year tax holiday, under the amendment. This too is a budget proposal.

The debt market has to be resuscitated as it has not received sufficient attention, in the past.

Interest on Central Bank securities will be exempted from the withholding tax.

A five year tax holiday will be given to firms using refrigeration of cold storage facilities and 10 year tax holiday for firms engaged in non-plantation agricultural undertakings which uses high technology and also a 10 year tax holiday to firms exporting or cultivating vegetable and fruit.

This is a measure to strengthening the markets.

Tyronne Fernando (UNP-Colombo District) said: How does the minister intend to increase tax income? Does he intend to bring in more tax payers into the tax net? There are only around 300,000 tax payers. It is learnt that the ‘Sudu Nelum’ movement is exempted from tax. If we are voting to exempt the ‘Sudu Nelum’ movement from tax I would like to have more details about this from the minister.

I think that due recognition should be given to the achievements in the field of sports by exempting the sponsorship of sports. Why don’t you exempt the Bandaranaike Museum Committee from tax and give due attention to the Bandaranaike Museum to give it a face lift to attract more visitors to it? The ministers should resolve to visit this museum regularly to acquaint themselves more with the policies of a farsighted and a perceptible politician, of this country. He foresaw the incidents that are taking place today. He spoke of the freedom of thought, of the press and freedom from arbitrary arrests. This government has forgotten the basic tenants on which it was founded. So the museum should be given fiscal incentives to carry out this laudable task.

Contd. tomorrow