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Public
servants to pay taxes - on paper! Only 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. This 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. The 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. Taking 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. The 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. |
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