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"The new Inland Revenue Bill will broad-base the tax system and incorporate globally accepted new tax principles to deal with international cross border relations," Finance Minister Mangala Samaraweera said. He was speaking at a meeting with representatives of the trade unions of the Inland Revenue Department (IRD). Sri Lanka’s Foreign Direct Investment dropped by 45.6 percent to a very low level of slightly over US 300 million dollars in 2016 from 658 million in 2015, official data shows, with the island experiencing a period of policy instability with inconsistent taxation.
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Samaraweera said he was prepared to consider trade union concerns in order to enhance the tax revenue of the government. The trade union representatives briefed Samaraweera on administrative and technical issues in the department. The representatives cited the lack of local and foreign training opportunities for officers of the Inland Revenue Department and apprised the minister on issues faced by them with regard to the payment of incentives. They also stressed the need for a new building for the head office of the department. The government expects the Inland Revenue Bill will be a key aspect of the fiscal consolidation drive after weak tax collection in recent years, partly due to the complexity of the Act. In May, the cabinet gave the go ahead to gazette and present in Parliament the new Inland Revenue Bill, as proposed in budget 2016.