VAT revision: President calls for immediate meeting

Against the backdrop of mounting public unrest against the recent hike of Value Added Tax (VAT), President Maitripala Sirisena has called for a meeting with the officials of Inland Revenue Department today for a discussion on the possibility of revising it, it is learnt.

The prices of a number of items and services rose as a result of the increase of VAT and the Nation Building Tax (NBT). Wholesale and retail traders took the streets in many areas closing their shops and protested against the move.

Trading activities in some towns and cities were ground to a standstill as a result, on some days. President Sirisena announced publicly that he would take steps to cushion the burden caused by the tax hikes.

Accordingly, a meeting will take place today afternoon at his office with the officials of the Department and the other stakeholders to see the possibility of revising certain tax rates.

VAT rate was increased from 11 per cent to 15 per cent. Also, VAT exemptions granted to health and telecommunication services were done away with. Besides, the threshold for VAT on wholesale and retail trade was expanded making more and more traders liable for tax payment.

(Source: Daily Mirror – By Kelum Bandara)