There is no crisis in the economy but only challenges which will be overcome soon with the direction given by the budget to steer the economy in the year ahead, Finance Minister Mangala Samaraweera told journalists at the first post budget media briefing at the Finance Ministry on Thursday.
The government presented the budget on Tuesday for 2019 under the theme ‘Enterprise Sri Lanka - Empowering the People and Nurturing the Poor’.
“Bankrupt politically spread rumours that the economy is in crisis and that the budget is an election oriented populist budget. There is no crisis whatsoever in the economy except for challenges that we are prepared to face,” Samaraweera said, adding that the Rajapaksa regime that rode on the military victory in 2009 to gain popularity did not lift a finger to uplift the standards of the war heroes whose salaries for the past 20 years have not been increased.
The budget proposed to increase the Commando allowance for the Tri-Forces to Rs. 5,000 from Rs. 1,000 and the housing allowance by 100 percent.
“I was shocked to hear that the salaries of the Forces had not been increased for many years. The Rajapaksas were praising the Forces but failed to increase their salaries,” the minister said, adding that there has not been an increase in the public sector workers salary from 2015 to 2020 where a worker’s salary has been increased from Rs. 11,730 in 2015 to Rs. 21,740 in 2017 and teacher’s salary has gone up from Rs. 16,000 to Rs, 29,000 in 2017.
An interim allowance of Rs. 2,500 to the salaries of public sector workers will come into effect from July 1.
However, when journalists questioned the rising number of taxes burdening the low income segment the minister said, Sri Lanka is one of the countries that has the lowest taxes.
Responding to having different fuel emission tax rates for vehicle instead of one rate and the luxury tax on vehicles the minister said the government had revolutionised the way vehicle are taxed shifting from the CIF value based taxation to engine capacity taxation.
Production duty on Petrol vehicles of less than 800 CC will be increased by Rs. 150,000, those less than 1000 cc by Rs. 175,000 and those less than 1300 cc will be increased by Rs. 500,000 from March 6. Further, production duty on hybrid vehicles - less than 800 cc - will be increased by Rs. 250,000 and for less than 1500 cc will be increased by Rs. 500,000. Production tax on three-wheeler with 200cc will be increased by Rs.60,000.
“The budget has offered relief to all segments. The Enterprise Sri Lanka program was launched to restore the pride the country had as a trading hub. There will be more entrepreneurs created through the loan scheme supported by the ‘Gamperaliya’ program to re-awaken the rural economy.
Around Rs. 48 billion has been allocated through the ‘Gamperaliya’ program, and it has been proposal to set up a fund under the Central Bank to provide guarantees to the SME Sector under the ‘Enterprise Sri Lanka’ program.