Sunday March 24, 2019
sub

Sri Lanka car taxes for LC's from March 05, VAT for apartments in April

Mar 14, 2019 06:42 AM GMT+0530 | 0 Comment(s)

ECONOMYNEXT - Sri Lanka's higher car taxes will apply to letters of credit opened after March 05, and apartments to agreements signed from April, Finance Minister Mangala Samaraweera said, treating people better than in the past.

Sri Lanka's budget for 2019 contained fewer tax shocks and interventions than in past budgets, brining Sri Lanka in line with budgets in more stable countries in South East Asia like Vietnam where the population hardly knows whether there is a budget presented or not.

Sri Lanka had a practice in the past where taxes where applied to all vehicles including those in the port, changing the legal framework from the time the decision was made, undermining just rule of law by changing laws with no prior warning.

Finance Minister Mangala Samaraweera said vehicles imported on letters of credit opened before the budget, will be allowed to be brought at the old rate.

A value added tax on apartment sales will also apply from April.

"It will be only for legally notorized sale agreements," he said.

The tax was also known to be applied and prior warning had been given much earlier, improving rule of law compared to the past.

Unlike East Asia or in so-called 'developed' or 'free' countries where the state treats people better and they are able to climb out of poverty easily, Sri Lanka slams taxes overnight through midnight gazettes without any discussion in parliament, a freedom lost to the people since the 1970s.

The lack of stability in law even for a year, is a sign of arbitrary state planning, which is not found in free countries where people can build their lives brick by brick, without roadblocks from an ruling class and bureaucrats.

In 2015, Sri Lanka's investment environment was severely hit when a budget slammed retrospective taxes.

"Nothing distinguishes more clearly a free country from a country under arbitrary government than the observance in the former of the great principles known as the Rule of Law," explained economist Friedrich Hayek, who saw European nations descent into poverty under planning.

"Stripped of technicalities, this means that government in all its actions is bound by rules fixed and announced beforehand – rules that make it possible to foresee with fair certainty how the authority will use its coercive powers in given circumstances and to plan one’s individual affairs on the basis of this knowledge."

"Thus, within the known rules of the game, the individual is free to pursue his personal ends, certain that the powers of government will not be used deliberately to frustrate his efforts."

However, the budget has introduced some taxes to frustrate the efforts of people such as an e-ecommerce para-tariff, which may eventually make trade in services, which is now free, as unfree as goods trade, which the country is trying to undo.

In 1948, when the country got self-determination, the rulers inherited a European-style nation state with all its appendages that could rob freedoms easily though the gazette by-passing parliamentary debate, and also imposed nationalism.

But the population was unaware how the agencies created by the British such as customs, inland revenue, jails, the gazette, the police, a standing European style army armed with European weapons, and the parliament itself could be use to easily take away their freedoms not only through regulations and frequent tax hikes but also through discriminatory nationalist rules which cannot be called a 'law' as they violate the fundamental principles of natural justice, critics have said.

Native rulers have also used the tax system not just to raise revenue but to punish citizens and bend their will to suit the vicarious desires of a ruling class and bureaucrats who also changed their thinking to French or Prussian style. A yellow-vest style carbon tax is to be implemented this year.

A soft-pegged Central Bank was also created after self-determination, which has destroyed the concept of sound money and cut the feet from under the poor by permanent depreciation.

Samaraweera's economic agenda, including a free trade agenda, market pricing of fuel has been up-ended by monetary policy errors inherent in operating a so-called soft-peg by printing money to keep rates artificially down, while trying to collect reserves by pegging. (Colombo/Mar14/2019-SB)


 

Name *
Email *
Designation
Company
Telephone Number