Economists called on the Government to unveil its plan for the efficient and productive use of the public taxpayers’ money.
Currently the direct tax ratio to indirect tax ratio is 20%:80%.
“This is unfair,” Head of the Department of Economics of the University of Colombo, Prof. W. Wimalaratana said, adding that an amendment to the Inland Revenue Act was therefore acceptable. The Government is scheduled to enact an amendment to the Inland Revenue Act, No. 10 of 2006.
Another option available to the Government as opposed to increasing the direct tax ratio includes reducing indirect taxes, the incidence of the latter falling upon the common man.
Prof. Wimalaratana observed that the opposition mounted in relation to the matter by the Parliamentary Opposition including the Joint Opposition was symptomatic of the behaviour and conduct of all Oppositions including all present, previous and future ones, and was based on political gain and a lack of any basic understanding of the economy or taxation.
“The Government does not have sufficient resources and therefore is happy to raise direct taxes. There are persons who do not pay the tax due to the Government. If individuals exceed the limits of the average income (annual income of Rs 1.2 million), then they must pay. The Government is wasting a lot of money on unnecessary things. There is a lot of corruption. The latter two issues must be addressed simultaneously. It is subject to the conditions of efficiency and productivity that the Government must obtain taxes,” he explained. RLJ