Acting Finance Minister Dr. Ranjith Siyambalapitiya told Parliament yesterday (9) that the government will recover the income tax related to Rs.16 billion lost by the government due to the reduction of the Special Commodity Levy imposed on imported sugar.
Minister Siyambalapitiya pointed out that under the current law, 24% of that amount can be recovered from the relevant companies as income tax.
Siyambalapitiya made these observations while presenting the report submitted by the Inland Revenue Commissioner to the Parliament based on the Auditor General’s report on the irregularities regarding imposing a tax on imported sugar.
Effective for a period of three months from October 14, 2020, the Special Commodity Levy of 50 rupees per kilogram of imported sugar was reduced to 25 cents to control the rising price.
However by not giving the benefit of the relevant tax reduction to the people and keeping it in the hands of the importers, the government has estimated the revenue foregone as Rs.17,760 million.
Ten companies have been identified that retained the income, and one of them has imported 45% of the total amount of sugar.
The Auditor General’s report shows that the company’s sugar import has increased by 1220% during the period when this tax concession was granted compared to the same period last year, Siyambalapitiya noted.
Minister Siyambalapitiya said that according to the powers of the Inland Revenue Commissioner, the relevant tax collection activities are expected to be carried out and the government is ready to provide all necessary support.
The Acting Minister requested all parties in the Parliament to support the collection of this amount which can be collected under the existing law.
Siyambalapitiya further said that in the future, the Finance Ministry will take measures to ensure that such emergency tax reduction decisions are not made without consultation with all parties.
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