Sri Lanka income taxes have to be paid by all: Treasury secretary

May 07, 2012 (LBO) – Amid pressure from a parliamentary committee for remaining workers of state-enterprises to pay income taxes, finance ministry secretary P B Jayasundera has said all persons must get used to paying taxes. Jayasundera said even a person earning 200,000 a month only paid about 10 percent in tax and the average tax rate for even highest salary brackets were only about 17 percent.

A person who earned above 50,000 a month with the first 400,000 rupees exempt, only paid about 4.0 percent as taxes, he said.

“These workers are should also get used to paying these taxes,” Jayasundera said. “If a person who earns more than 50,000 rupees a month says he cannot pay 4 percent tax, there is something wrong.”

He said the issue at state enterprises arose in the mid 1990s when the government decided that workers in state enterprises should pay income taxes.

Later incomes other that state salaries of public servants were taxed. But in a recent budget all incomes were being taxed.

“Now politicians are also being charged tax. From last year, PAYE, members of parliament, ministers, senior officials all had to pay taxes,” he said.

So from 2010 all public servants should also pay tax for several