Ceylon Chamber commends continuity of enterprise Budget
The Ceylon Chamber of Commerce has welcomed the initiatives in Budget 2018 aimed at boosting trade and investment, improving housing ownership and the development of SMEs, and its overall consistency with strategies outlined in Vision 2025 and the Prime Minister's economic policy statement of October 2017.
In a statement the Ceylon Chamber has also commended the proposals to drive Sri Lanka towards becoming a more environmental-friendly economy, with an emphasis on improving access to finance for the development of enterprises, SMEs and startups.
The Chamber adds that National Budgets should focus on actionable outcomes within the relatively short time period of a year while facilitating the long-term vision, as opposed to being viewed as an all-encompassing policy document of the Government, and that Budget 2018 provides a good foundation for budgets to be viewed in this light.
However, it warned that measures to raise revenue through new levies could adversely impact industries that are also facing regulatory, investment and external challenges, and called for more clarity and consultation on proposals such as the removal of para-tariffs, reforming existing laws/acts and VAT exemptions (such as in the sale of condominium housing units). It adds that initiatives in shifting towards electric vehicles must be supported by a long-term energy plan that will complement the end objective of using non-fossil sources.
Extracts of the statement are reproduced below:
Focus on macroeconomic stability
While many proposals appear to complement the Government's medium-term vision beyond 2018, it is important that the Government does not waiver in the near-term from the current fiscal consolidation path.
The budget deficit target of 4.6% of GDP, set out for 2017 in last year's Budget, is expected to miss its target by 0.6% in 2017. While this is due to a higher interest expenditure than forecasted, it would have been mitigated if revenue grew as forecasted with the successful implementation of revenue proposals in the 2017 Budget.
The aim to reduce the deficit to 4.8% in 2018 is a less ambitious target compared to previous years, which is attainable if the tax revenue measures proposed in the 2018 Budget are implemented. This aim will be complimented by the new Inland Revenue Act, expected to come into effect from 1 April 2018. The continuation of fiscal consolidation will support monetary policy and help develop the recent improvement in macroeconomic stability with the build-up of reserves and improvement in the balance of payments.
The Ceylon Chamber of Commerce welcomes the initiative by the Finance Ministry to set up an Implementation Unit to monitor the progress of the proposals outlined in the speech.
The establishment of such a unit is greatly anticipated, given that a similar proposal was announced in the 2017 Budget as well, with a proposed committee comprising members of the private and public sectors to monitor the implementation process.
It is important to have confidence that the Government is serious about each of the many proposals announced in the 2018 Budget.
Too often have ambitious and laudable proposals been confined to the budget speech with a lack of implementation, creating an environment of policy uncertainty. There is a lack of attempts made to implement and honour these pledges. Some previous proposals that have remained unimplemented in recent budgets are repeated in the 2018 Budget. The Government will need to take serious steps to implement the announced proposals so as to improve its credibility.
A consultative approach to implementation
The Ceylon Chamber of Commerce hopes that the outputs and outcomes of the Implementation Unit will be available to the public as reported and include regular consultations with private sector organizations. The Ceylon Chamber is willing to engage with this proposed unit to provide feedback and input from the private sector on proposals that offer value to industry. It is important for the proposed policies to be implemented with specific timelines put in place beyond the preliminary indications outlined in the 2018 Budget speech. The above steps will help restore and renew public and investor confidence that desired targets will be met as planned.
While there is less ambiguity in a majority of the proposals, certain measures could have a negative impact on industry if implemented as mentioned in the 2018 Budget. Measures to raise revenue through new levies (Special Levy for Debt Repayment and Cellular Tower Levy) could adversely impact industries that are also facing regulatory, investment and external challenges. Proposals such as this and removal of para-tariffs, reforming existing laws/acts and VAT exemptions (such as in the sale of condominium housing units) will require further clarification and input from the private sector before implementation.
The Ceylon Chamber also recommends the Government progress their renewed commitment in State Owned Enterprise (SOE) reforms and Capital Market development through divestment in holdings of non-strategic enterprises, with a credible plan of action. Initiatives in shifting towards electric vehicles must be supported by a long-term energy plan that will complement the end objective of using non-fossil sources.
Repositioning the purpose
of National Budgets
The National Budget should not be viewed as an all-encompassing policy document of the Government. Instead, National Budgets should focus on actionable outcomes within the relatively short time period of a year while facilitating the long-term vision. Further, National Budgets should shift from imposing overnight tax changes, that have proved to be disruptive to businesses in the past, and instead aim to provide grace periods for the implementation of medium to long-term tax plans. The 2018 Budget provides a good foundation for budgets to be viewed in this light.
- India’s Choice: Saintliness Vs Efficiency
- Commercial Credit Japanese Firm moves in
- Man shot dead at Punchi Borella
- SAITM still exists, claims GMFSPA Group to meet Maha Sangha
- Lanka tour operators to visit Pakistan
- Fake sms on petrol shortage again! Leads to panic buying in Kandy
- Zimbabwe's ruling party sacks Mugabe
- Ranil before PCoI today
- Gintota clash masterminded by ex-PS member-Police
- BBS Chief in fiery row with scribe Alleged threat to slap Chandraprema
- SL has executed 76% of the proposals by UPR
- Gintota Unrest:PM calls for official report from IGP
- Action against COPE MPs caught talking to Aloysius Speaker to meet party leaders this week
- UNP furious over phone tapping CID, AG’s Dept blamed for ‘media show’
- Treasury Bonds Probe AG to question PM
- Gintota clashes 19 remanded Govt on desperate mission to arrest extremists
- ‘A prisoner in Indian jail on Eelam soil’
- Sagala vows to crush Aava group Police deployed in full strength
- Politico’s son-in-law in school frock drama Teacher threatened after student is reprimanded
- Lanka alarmed over increased smuggling of ‘KG’
- SC to hear Tangalle ASP assault case
- 656 kg Glyphosate nabbed
- FPTP opens gate for undesirables, warns Amunugama
- EC to issue nomination notice on 27th
- NPC Education Minister shuns national flag Sarveshwaran was Chief Guest at school event
- Kandy SC in runaway win
- SLC clarifies Dilruwan’s actions
- India take 49 run lead
- Six-year-old wins two Silvers in shooting events
- Renown rout Blue Stars 4-0
- MAS Unichela emerge champions
- Senkadagala Rally
- Air Force SC in 15-7 win over Police SC
- ‘Singer Cup’ Under-19 Schools Cricket Malshan scores century
- Afghanistan U-19 create history Youth U-19 Asia Cup 2017
- Mahinda College move on to all-island stage
- Glitz Cric Quiz back for its fifth year
- Pogba drives Man Utd fightback
- England in emphatic win
- Neuville wins Rally Australia
- CEB and Air Force emerge volleyball champs
- Angelo, Lahiru prop Sri Lanka
- Ritzbury Sir John Tarbat Junior School Athletic Championship 2017 Janadhipathi BV and St. Joseph’s emerge champions
- Air Force, Police look for first win
- Navy defeat lethargic Havies
- Power plant delays cost Rs 51 B
- 200 to 300 HYDROPOWER PROJECTS ON HOLD
- DSI MD calls for protectionism
- SL to produce sea wave energy
- WB moots PPPs for gender parity
- Menik Farm refugee village gets apparel factory
- Reserves strengthened by $ 74M
- Asian markets end quiet week mixed
- Treasury guarantees of Rs 8,55B sustain 22 public entities
- Will retail apocalypse hit Britain next?
- Huawei creates ‘Smart City Nervous System’
- NDB Capital Scholarship Programme marks 4th year
- Abans wins top retailer and service awards
- How to get rich and mobile banking going social
- A minimalist approach to social media marketing
- Why Moody’s is no longer singing the blues on India
- Women breach world of big oil
- SriLankan Airlines’ marketing activations rewarded
- iflix Sri Lanka opens new office in Colombo
- Aviation sector to be liberalized
- The National Flag A Muddled Tamil voice
- Rohingya children Face a bleak future
- New Constitution:National perspective versus political aspirations
- Pyramid Selling
- Centenary of the October Revolution: 1917 – 2017
- China and Vietnam: Beyond Diplomacy
- Middle East: Kurdish Pawn Sacrificed
- Concretes and abstracts Two comics at the Savoy in London
- Row over beer tax
- Illegal mining Muttur’s sandy secret Hundreds of tons of sand taken away at night
- eLECTRIC AND HYBRID CARS MUST BE PRICED REASONABLY
- Wigneswaran’s claim Devanampiya Tissa was a Tamil king An academically naïve proposition Prof Raj Somadeva
- There is no journey with the UNP
- Core values of the UNP are eroding - Pradeep Jayewardene
- UN compensation for Kuwait workers Rs 3.2 B on migrant worker welfare
- An argument for a new Constitution
- ‘Otriachchi’, ‘Orumiththa Nadu’, ‘Aekeeya Rajya’ and unitary state
- A Constitutional Framework for Sri Lanka
- PAST LIFE AND RULING PLANETS IN KRISHNAMURTHI PADHDHATHI
- Build before onset of Kona Masa
- Palms of road accident victims
- Want to get rid of malefic Saturn ?
- Installing doors and windows according to Vastu
- Our children and our cinema
- INTERPRETING ASIAN CINEMA: CHALLENGES AHEAD
- How Sanskrit journalism is slowly hogging headlines
- ice manufacturing in South Asia
- CMSC’s season finale concert
- Two documentaries on Sri Lanka in Film South Asia 2017
- Politics of nostalgia
- Vibrancy of classical Sinhala poetry
- Kite Surfing Lanka Kalpitiya An experience of a lifetime
- Ella and mini Adam’s Peak
- A cave of history -Ravana Cave
- Conquering Fashion
- Gavin Ryan’s Salon Professionalism to the next level
- THE WRITER’S KITCHENETTE THE CRANBERRY ADVENTURES
- Calamitous Earthquake in Iran
- Scientists warn of ‘giant leap backward’ at climate talks
- Death of Ananda Senaratne