Public Finance Committee says no to VAT reduction

By Yohan Perera and Ajith Siriwardana  

The Parliamentary Committee on Public Finance has refused to grant the mandate for the order by which reduction of VAT to 8 percent was introduced by the new government. 

“The Committee refused to grant mandate for the Order Under Section 2A of the Value Added Tax Act, No. 14 of 2002, as amended by Act, No. 06 of 2005, to reduce the Value Added Tax to 8%. Accordingly, the committee also called for a detailed financial justification with regard to the aforesaid to be presented at the next committee meeting” a statement from the Parliament media unit said.  In addition, the Committee also refused to grant mandate for the Order Under Section 3 of Excise (SPECIAL PROVISIONS) Act, No.13 of 1989 on products of tobacco or of tobacco substitutes. The Committee thus directed the respective officials of the Ministry of Finance to consult the National Authority on Tobacco and Alcohol requesting the officials of the authority to be present at the next committee meeting  

The committee further decided to call for observation of the Central Bank of Sri Lanka (CBSL) regarding the Forensic Audit report on the issue on Treasury Bonds at the committee meeting held yesterday (05) at the Parliament Complex.