Deputy Minister of Industries and Entrepreneurship Chathuranga Abeysinghe states that there is no possibility of reducing taxes within this year, as the government is required to collect 15.1% of the Gross Domestic Product (GDP) in taxes in accordance with agreements reached with the International Monetary Fund (IMF).A reduction in indirect taxes, in particular, will have to be implemented gradually.
We cannot expect a tax reduction this year.
It is necessary to collect the required amount of taxes amounting to 15.1% of GDP, as stipulated by the IMF.
However, once we emerge from this process and revenue collection efficiency improves, it will be possible to extend concessions to products from various industries, he stated.Furthermore, he emphasized the governments long-term objective of providing tax concessions, particularly for technological investments in the banking sector and industries.The upcoming budget, scheduled for February 17, will outline these initiatives.
The government intends to offer the necessary facilities and support to industries, aiming to create a conducive environment for industrial growth in the coming years, he added.Deputy Minister Abeysinghe also revealed plans to introduce a new tax policy for industrial imports.We are implementing a new tax framework known as the Tariff Policy.
Under this policy, we aim to reduce or eliminate taxes on production inputs.
Every industrialist now has a clear understanding of the imported inputs required for their production processes.
This is the essence of the tariff policy, he explained.Addressing concerns within the industrial sector, he highlighted challenges posed by tax-free imports and undervaluation of invoices.Despite the efforts of local industries, certain imports enter the market at significantly low prices without paying the necessary taxes, sometimes with manipulated invoice values.
To counter this, we are introducing protective measures under the anti-dumping policy, which will provide support to the industrial sector, he added.He further clarified that tax policies may vary across industries, but an overall reduction in taxes cannot be expected in the forthcoming budget.