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Choppy Ride

The 0.1 percent tax will be slapped on travellers cheques, certificates of deposits and current account balances over Rs. 10,000.

rnrnBut the Bankers Association warned of teething problems, as its members had to change their software to accommodate the changes.

rnrnldblquote It will not be a smooth change over from day one, dblquote warns the Bankers Associations new chief, Kapila Jayawardene.

rnrnThe Treasury has instructed all commercial banks to deduct the tax at the end of the month and remit the monies to the Inland Revenue Dept.

rnrnldblquote We should have things running by July or so, dblquote Jayawardene adds.

rnrnThe government is hoping to raise Rs. 2.3 bn through the debit tax over a one-year period.

rnrnThe debit tax was in operation during early 1970 quote s, during an era of closed markets and closed economic policy.

rnThe tax drove businesses away from using cheque transactions. Businessmen instead, relied on cash dealings, making transactions less transparent. rn

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