Arrangements are underway to introduce a new inland revenue act with the intention of simplifying and modernizing the act as per the 2016 budget proposals, but financial experts say the one to be introduced is a carbon copy of the inland revenue act by the IMF given to Ghana in 2016. Various inland revenue act models have been prepared in consideration of the economic capabilities and national revenue of the respective countries. The one given to Ghana is one such model.
This situation has arisen due to the relevant authorities’ failure to establish a proper tax policy for the country, as demanded by the IMF for some time now. As a result, Sri Lanka has been made to accept the model for another country. Furthermore, it is too early to estimate success of Ghana’s model. Therefore, the matter needs careful consideration despite whatever form the Sri Lankan act takes, they say.
Cabinet approval has been given to advice the legal draftsman on a new inland revenue act to be based on a concept paper already prepared with the inclusion of new powers, solutions to a weakened tax basis and tax evasions, modernizing and simplifying tax administration and implementation of the capital gains tax policy to make tax administration by the Inland Revenue Department more efficient and at the same time improving the safety of the taxpayers and expanding regulations relating to revenue sources.
However, the inland revenue trade unions joint committee says the authorities are introducing a new act at the insistence of the IMF. It says every attempt will be made to defeat the privatization of the state tax administration through that.