The 2022 Budget has failed to provide the much needed fillip to the small and medium sector players of the pandemic-hit tourism industry, said SME sector industry personnel who pinned hopes on the expenditure and revenue statement for some consolation.
“SMEs, the most affected segment of the global pandemic, have been neglected,” said Kegalle District Hotels Association President Y.A. Nayana Udayapriya Kumar, calling on the authorities to act fast to save the lucrative industry which is now in the doldrums.
The Budget which was supposed to inject new energy to the ailing industry has rather aggravated the plight of the industry which has been called to contribute to social security.
The Budget 2022 proposed a 2.5 percent tax titled ‘Social Security Contribution’, on companies with an annual turnover exceeding Rs. 120 million, from April next year.
“We want the lawmakers to take stringent action against lenders who are not complying with the government instructions to grant relief to borrowers who have fallen from the frying pan into the fire,” said former GOH Chairman and current Arvani Collection Chairman Rohan Jayasinghe.
The Governwment extended the grace period for tourism sector borrowers up to June 2022 and warned lenders of stern measures for non-compliance.
“We will come down hard on those who are not falling in line with our instructions to ease the pressure on tourism sector borrowers. Any institution or person exerting pressure on borrowers will be dealt with,” said Central Bank Governor Ajith Nivard Cabraal.
Banks and leasing companies forcing borrowers to settle payments ignoring the moratoriums have been brought to the notice of authorities.
However, so far no action has been taken and laws enforced to penalise lenders violating regulations.
“The SMEs need a complete or at least a partial writing-off of loans to sustain operations if not most will have to call it a day,” Jayasinghe said, adding that the SMEs in particular have been badly hit for the past three years since the Easter Sunday attacks.
SME sector operators also said that they have been blacklisted by CRIB and that they cannot access any financial support.
The new The Hotels Association of Sri Lanka (THASL) President M. Shanthikumar called on the authorities to exempt the tourism sector from the proposed top line tax given its contribution to foreign exchange earnings.
The tourism industry recorded around 29,000 arrivals for the first three weeks of November surpassing the record hike in October.
According to Sri Lanka Tourism Development Authority data, around 22,771 people visited the country in October.