servants to pay taxes - on paper!
By Iromi Perera
Government servants from the Prime Minister downwards
will be filing tax returns for the first time in more than 30 years
after the 2005 tax proposals of the budget became effective from
April 1, officials said.
President Chandrika Kumaratunga is exempt from the new practice.
According to the Inland Revenue Department, public sector workers
whose salaries are Rs 600,000 and above annually, will be liable
for tax. While those who are liable will have to file returns, they
won't however feel the weight of taxes for some time, as the government
will bear this payment. The intention is that in time public sector
workers would be asked to pay their tax bill.
new tax would apply to anyone who receives a salary from the government
including the PM and Ministers. According to R.P.L Weerasinghe,
Commissioner General of the Department of Inland Revenue, the introduction
of taxation for government servants is so that they will get used
to the idea of being a 'taxpayer'. There have been many complaints
as to why private sector employees have to pay tax while government
servants do not.
same rules and regulations that are applicable to normal taxpayers
will not apply to government servants at once, as this is the first
time it has been introduced, since the 1970's.
into consideration that government servants' salaries are much lower
compared to the private sector, concessions have been made. Only
if 50 per cent of the annual salary is above Rs 300,000 will a government
servant be liable for taxation. "Some can say that there is
no taxation, but this is the starting point," said Weerasinghe.
same principle that was applied to the banking sector will be imposed
here, where the government will bear the taxes for some time and
gradually the person who is liable will have to start paying. However
if a government servant has another source of income and is liable
for tax from that, then he will have to pay that tax.