ECONOMYNEXT – Sri Lanka is planning to revise the basis of a ‘feel-the-pain’ illiberal tax proposed on European lines which critics say violates a time honoured liberal governance principle established by South Asian civilizations for millennia.
Sri Lanka proposed a ‘carbon tax’ which hit older cars, owned by pensioners which were hardly used, proposing lower taxes for cars owned by affluent users including hybrids which were on the run everyday.
The tax was originally based on a complex criteria including the age of the vehicle, engine capacity, which had no direct connection to the actual use or burning of fuel.
Finance Minister Mangala Samaraweera had decided to revise the basis in the wake of public appeals, experts and difficulties in implementing the tax at the level of division secretaries, the state information office said.
The cabinet had given the approval for the Finance Minister to change the basis at the committee stage of the debate, so that it is based more on fuel use.
Climate advocates, the green energy lobby and interventionists in Europe have proposed ‘feel-the-pain’ taxes which are designed to hurt tax payers and make feel enough pain to change their behavior.
Critics had pointed out that such mis-use of the tax system is against the governance principle of South Asia, which had been adopted world wide as well, which broadly says taxes should be collected as a bee collects honey without hurting the flower.
In France irate motorists took the streets after a feel the pain carbon tax was proposed on vehicle users who are already paying around 60 percent of the retail price of petrol and diesel as taxes.
In Sri Lanka petrol which has a higher hydrogen atom content is taxed at a higher rate and is also retailed a higher rate than diesel, which has more carbon, causes more pollution generally with nitrogen oxides and has also been named a probably (group 2A) carcinogen by the World Health Organization. (Colombo/Oct11/2019)