The cash-strapped Sri Lankan government has directed the Inland Revenue Department (IRD) to recover all taxes payable by the Golden Credit card company and its depositors numbering around 7,200, a move that would dismay depositors.
 This money will be recovered from the sales of assets of the company and its directors including Ceylinco Chief Lalith Kotelawala before making repayments to depositors, informed sources told the Sunday Times FT.
While the total worth of deposits at the failed Golden Key is estimated at Rs 26 billion, an amount ranging from Rs. 3 to 8 billion will be withheld by government authorities for non-payment of taxes and the fine for tax default.
The IRD has already started investigations into depositors of Golden Key for non payment of taxes on interest income or investing large sums of money seeking high interest rates, official sources said adding that depositors who invested millions of rupees without divulging their sources of income should pay income tax and they cannot be given any relief under the Inland Revenue Act.
There are over 7,000 depositors who have deposited sums of money ranging from Rs. 250,000 to Rs. 8 million while a few have invested Rs. 200 million and over.
Meanwhile, the Golden Key Depositors’ Association has protested against attempts made by the IRD to tax depositors who are struggling for their existence without either their capital or interest.
The Association met Minister of State for Finance Ranjith Siyambalapitiya on Wednesday and the newly appointed Tax Chief Mahinda Medagoda the following day to present their grievances. Minister Siyambalapitiya told the Sunday Times FT that he told the depositors that he will direct the authorities to consider their request and to find out ways and means to provide some redress but there is very little they can do as the matter is before the Supreme Court.
However, Association President Anusha Emmert told the Sunday Times FT that Minister Siyambalapitiya and new tax Chief Medagoda had promised them to grant some relief to depositors suffering without an income for living expenses.
The tax chief has also promised to send one of his officials to explain the stand of the IRD on the tax issue at a meeting of depositors. The Association’s Treasurer Dushyanthi Hapugoda said that Golden Key deducted a 1% tax from the interest earned by depositors.
"The company should have levied the applicable tax at that time as this was something which depositors don’t pay directly,” she said. She disclosed that depositors are being summoned by the IRD and asked to pay tax and this is unfaire because the majority of depositors are struggling to survive as they depended on the GK interest income. |
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