Taxes !

Our country is currently facing the worst economic crisis in its history. Development work, however, has not been able to meet day-to-day expenses. The whole country, starting with small families, is facing this problem of living. Members of poor families are unable to afford even one meal a day and the entire population of the country is in a crisis of not being able to find the cost of food on a daily basis. Not only food but also essential medicines, fuel and gas are in short supply.

The state government of Tamil Nadu in India is trying to raise money from the poor in its state to provide humanitarian assistance to the people of Sri Lanka. This is one of the strongest evidence of the unfortunate fate that has befallen Sri Lanka today, which has been hailed as the granary of Asia.

It is not a coincidence that our country is in such a predicament. This crisis, which has been going on for two or three decades, has reached its worst today. Not only the present government but also many governments that have existed in this country since the day of independence are responsible for this. The cause of this unfortunate situation was the foolish act of continuing to depend on debt, ignoring the collection of the national income of the country.

Two days after taking office, the new Prime Minister Ranil Wickremesinghe made a special statement analyzing the country's financial situation. If that is true, we are not in a pit today.

He says the country's economy is in a very bad state. Although the last budget showed a revenue of 2.3 trillion rupees at the beginning of 2022, the actual annual revenue was 1.6 trillion rupees. The Prime Minister also said that although the government expenditure in 2022 will be 3.3 trillion rupees, the actual expenditure will exceed 4 trillion rupees. The budget deficit for the year is $ 2.4 trillion, or 13% of GDP. Although the approved credit limit for the year was 3200 billion rupees, 1950 billion had been spent by the second week of May, he said. The Prime Minister has emphasized that even though the foreign exchange reserves in November 2019 were US $ 7.5 billion, not even one million could be found today.

The Prime Minister pointed out that at least $ 5 million could not be found for the landing of gas ships currently stranded at sea, adding that at least $ 75 million should be found for queuing. Also, $ 20 million has to be found immediately to provide gas. Currently, the Central Bank of Sri Lanka and public and private banks are facing a serious problem in finding dollars. Although he opposes the printing of banknotes as a matter of policy, the Prime Minister points out that there is no other option but to print new currency to pay the salaries of public servants this month. He also says that at present petrol is only available for one day.

In the face of this situation, Sri Lanka seems to be facing the worst economic crisis. Finding the money to get out of this is not easy.

As a solution to this situation, a number of steps have been taken to reduce government spending. The public sector has stopped recruiting new employees and restricting them from paying overtime and other benefits. Also, capital expenditure has been cut and the Ministry of Finance has instructed not to start any new development work. Agreements should not be signed for any project and such agreements already signed should not be extended.

Meanwhile, the Union of Secretaries to Ministers has requested the President to take steps to reduce the expenses of Secretaries to Ministries. Secretary General of the Secretariat Ajith Jayasundara has written a letter to the President informing him that for 20 ministries one ministry needs 100 secretaries for every five ministries. The monthly salary of a secretary is Rs. 100,000 and accordingly the salary is Rs. 100 lakhs. The secretariat says that this number should be reduced and experienced public servants should be appointed as secretaries and should be discontinued at present. It has also been informed that the allowance for the new ministers will not be paid. It has also decided to cut spending on the Prime Minister's Office by 50% from June. Twenty-six employees and 16 vehicles have been returned to their original locations.

The Inland Revenue Department has directed all public and private banks, finance companies and major taxpayers to pay the special tax proposed in the budget for the year 2022 immediately due to the difficulty in raising funds for the day to day needs of the country. This request has been made as the revenue available from the government is not sufficient to pay the salaries of the public sector. It is expected to collect around Rs. 100 billion from this surcharge to be levied on large companies and financial institutions proposed in the last budget.

Meanwhile, the country's financial situation has deteriorated due to the large amount of money spent on fuel imports.