Govt. game for Rs.600b revenue target in 2007
 |
| Perhaps to further enhance collection as well as ensure greater compliance, the Inland Revenue Department has kicked off an awareness campaign in the media. |
Encouraged by the success in the first half the Government is confident of achieving the Rs. 600 billion revenue target set for 2007.
During the first six months of this year, total Government revenue raised amounted to R. 260 billion, up by a very healthy 25% compared with the Rs. 207 billion collected in the corresponding period of last year. The amount in the first five months was Rs. 218 billion and end June data confirms that collection has increased by Rs. 42 billion.
The Budget 2007 is targeting a revenue collection of Rs. 600 billion.
Tax revenue saw a high 24% increase to Rs. 230 billion while non-tax revenue was Rs. 30 billion, up by 32% over the first half of 2006.
Perhaps to further enhance collection as well as ensure greater compliance, the Inland Revenue Department has kicked off an awareness campaign in the media. With the theme “Taxes: A duty not an obligation” the Department is driving home this message with effective advertising in print and electronic media.
“We won’t tax you. It is your income, so it is only fair that you decide how much you should pay,” a press advertisement of the Department states adding that people could overcome their difficulties and step forward. The press advertisements which feature different classes of people such as businessmen, professionals etc, also carry hotlines for queries. The television advertisements suggest that funds collected via taxes are for a better future depicting a modern developed Sri Lanka. This is perhaps to address concerns expressed by both tax payers and civil society that taxes paid are being used to fund wasteful government expenditure and not for true development that benefits the people.
Last month the Commissioner General of Inland Revenue A.A. Wijepala himself put a public notice thanking all taxpayers for their valuable contribution in the form of compliance with tax laws. “This has enabled me to meet with the revenue targets set for the Department,” the Commissioner said.
“In fact many taxpayers pay due share to the State willingly. It is usual, however, that there is a category of persons who do not honour their tax obligations to the full or at all,” the Commissioner said in his public notice.
In view of this, the Department has intensified action in detecting those persons who do not properly comply with tax laws. In the course of this initiative, the Commissioner regrets any inconvenience caused in the event a person receives repeated notices from the Department even though they have already complied with tax requirements and settled dues.
Tax payers have welcomed the public notice by the Commissioner though they opine that genuine and on time tax payers deserve greater recognition and service. There is also growing frustration among tax paying public over inaction or delay in apprehending tax evaders and fraudsters. A case in point is the multi billion tax fraud, believed to be South Asia’s biggest, which received much exposure but follow up efforts have been slow.
For better treatment of tax payers the Government this year introduced Gold Cards with a string of benefits.
Income tax revenue in the first five months of 2007 amounted to Rs. 41.1 billion up by 66% over the corresponding period of last year. VAT had increased by 21% to Rs. 71.5 billion while excise tax saw a growth of 5% to Rs. 37.3 billion. Import duty collection despite various waivers to cushion the cost of living, gained by 11% to Rs. 23 billion.
The Government with a view to sustain the higher revenue generation witnessed in the last three years and to augment it further several policy measures were implemented to broaden the tax base, revision of the tax rates and to strengthen the tax administration whilst ensuring a conducive environment for investment. Some however feel there is excessive taxation in certain sectors while new taxation was being mooted in some others.
These moves, it was pointed out, would stifle fresh investment as well as growth contrary to the creation of the conducive environment objective as stated.
As of May 2007, the Government revenue amounted to 6.7% as a ratio of GDP from 5.2% a year earlier.
The Department has added more than 30,000 new income taxpayers to the tax net from January to June while it has a target of 50,000 new taxpayers for this year. The Department has also opened 750 new income tax files for Government servants.
|
