The 2017 budget has increased the Embarkation Levy to generate greater government revenue at the expense of foreign exchange earnings from tourism and foreign remittances, while the country’s politicians continue to purchase luxury vehicles at concessional rates. The budget increased the Embarkation Levy to US $ 50 from US $ 30 and stipulated that US $ 35 will be remitted to the Treasury’s consolidated fund, which would increase state revenue by Rs.4.5 billion.
Analysts note that the increase in fees is likely to affect Sri Lankan women who account for the majority of the people labouring overseas to bring nearly US $ 8 billion in revenue for the country, which is currently Sri Lanka’s main foreign exchange earner. Over 1.7 million Sri Lankans work overseas and have to additionally register with the Foreign Employment Ministry and renew their registrations by paying fees as well. However, in the midst of massive indirect tax increases, the Members of Parliament (MPs) are importing ultra-luxury vehicles at the expense of tax payers’ money and the country’s foreign reserves with government permits, which the MPs are accused of selling in the black market. A section of media reported that Finance Minister Ravi Karunanayake recently imported a luxury SUV through his MP’s permit paying little or no taxes. Former Central Bank Deputy Governor W.A. Wijewardena had noted that it is grossly unjust for the representatives of the people to be engaging in waste extravaganzas while the people have to suffer under the pressure of high taxation brought into cover mistakes of the politicians. He had noted that each Sri Lankan minister costs over Rs.6 million a month. Meanwhile, even the remaining one third of the Embarkation Levy, which was transferred to the Sri Lanka Tourism Development Authority’s tourism promotional fund, was seized by the Treasury through the 2016 budget, therefore catching the entire US $ 50 from the Embarkation Levy. The increase in the Embarkation Levy, coupled with the increase in the tourist visa fees, tax hikes in the hotel and travel agent industries and the blanket value-added tax hikes, will make Sri Lanka more costly as a tourism destination. (CW)