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Wednesday February 1st, 2023

Sri Lanka’s CEB to charge additional 2.5 pct of social security contribution levy

ECONOMYNEXT – The Ceylon Electricity Board (CEB), Sri Lanka’s state-owned utility provider, will charge an additional 2.5 percent of social security tax of the total electricity bill with effect from October 01, the Public Utilities Commission of Sri Lanka (PUCSL) said.

PUCSL Chairman Janaka Ratnayake said on Thursday October 27 citing a communique from the ministry of finance that according to the Social Security Contribution Levy Act, electricity is subject to the new tax.

The Social Security Contribution Levy Bill was passed by majority vote in parliament on September 08. The levy was first announced in the budget for 2022 in a bid to raise government revenue after the economy was hit by the COVID-19 pandemic.

This tax is imposed at the rate of 2.5 percent on the importers, manufacturers, service providers and wholesalers and retailers with an annual turnover of more than 120 million. The expected revenue from this tax per year is 140 billion rupees.

In mid-August, the electricity tariffs were raised for the first time in nine years by 75 percent in order to minimise the continuing losses incurred by the CEB.

Opposition legislator Harsha de Silva has called the social security contribution levy a travesty.

Related:

Sri Lanka ‘social security’ levy is a travesty, should be a sunset tax: Harsha

(Colombo/Oct27/2022)

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  1. Harindra Dunuwille says:

    It is alleged that the CEB : (1) pays the Employees’ EPF contribution as well as its statutory liability, (2) CEB reimburses the PAYE tax deducted from the Employees’ pay, (3) that in addition to the EPF, and payment of gratuity on retirement, a pension scheme is also in place. Could someone enlighten me, please?

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  1. Harindra Dunuwille says:

    It is alleged that the CEB : (1) pays the Employees’ EPF contribution as well as its statutory liability, (2) CEB reimburses the PAYE tax deducted from the Employees’ pay, (3) that in addition to the EPF, and payment of gratuity on retirement, a pension scheme is also in place. Could someone enlighten me, please?

Sri Lanka shares edge up at close

ECONOMYNEXT- Sri Lanka’s shares edged up on Wednesday pushed as investors bought in to beaten down shares following the previous session’s drop, market analyst said.“

At this price level what we are seeing is a lot of confidence from the investors to collect when the prices drop. So, the market is not falling sharply,” a market analyst said.

Market had also seen buying in Expolanka shares on speculation that the parent company of SG Holdings was buying back into the shares.

All Share Price Index (ASPI) edged up by 0.96 percent or 84.96 points to 8,950.01.

The most liquid index S&P SL20 gained 1.27 percent or 35.02 points to 2,799.53.

Banking and Insurance counters had seen interest on the back of positive sentiments from the IMF.

The central bank has said it could cut interest rates in future when the the country sees fall in inflation, which has already started decelerating.

The market saw a turnover of 1.5 billion rupees today,lower than the month’s daily average of 1.8 billion rupees and nearly half of 2022 average turnover of 2.9 billion rupees.

The bourse saw a flow of net foreign inflow of 45 million rupees extending the net offshore buying to 1.9 billion so far this year.

Top gainers of the day were Commercial Bank, Expolanka, and Ceylinco Insurance. (Colombo/Feb01/2023)

 

 

 

 

 

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Sri Lanka bond yields down at close

ECONOMYNEXT – Sri Lanka’s bond yields were down at close following a bond auction on Wednesday, dealers said while a guidance peg for interbank transactions remained unchanged.

“The rates were steady at the auction,” a dealer said.

“This can be a signal to the market saying the rates will go down in the future.”

A bond maturing on 01.07.2025 closed at 32.40/60 percent, down from yesterday’s 32.60/85 percent.

A bond maturing on 01.05.2027 closed at 29.10/35 marginally down from yesterday’s 29.20/75 percent.

The Central Bank’s guidance peg for interbank US dollar transactions remained unchanged at 362.14 rupees against the US dollar.

Commercial banks offered dollars for telegraphic transfers at 371.38 rupees on Friday, data showed. (Colombo/Feb 01/2022)

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Sri Lanka bill auction hits pothole after 2025 bond spike

ECONOMYNEXT – Sri Lanka sold only 45 billion rupees in Treasury bills at Wednesday’s auction after offering 120 billion rupees, data from the state debt office showed, amid market confusion over a spike in a two year bond at an earlier action.

30.1 billion rupees of 3-month bills were sold at 29.91 percent, unchanged from a week earlier after offering 60 billion rupees for auction.

5.1 billion rupees of 6-month bills were sold at 28.72 percent, flat after offering 30 billion.

10.3 billion rupees of 12-month bills were sold at 27.72 percent after offering 30 billion.

Phase II subscriptions have been opened.

The market was foxed after the 2025 bonds were accepted at sharply higher yield than market on January 30, dealer said.

There was further confusion as the there was an outright purchase of 2025 at around 29 percent earlier in January.

Some investors speculated that the authorities were trying to drive more buyers towards short end bonds as bill volumes were getting larger. (Colombo/Feb01/2023)

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