CMC’s new tax payment system will improve country’s current status as ‘best in region for business’:

Monday, 27 January 2014 00:00 -     - {{hitsCtrl.values.hits}}

The recently-introduced Colombo Municipal Council (CMC) Online Tax Payment System will greatly improve the country’s ‘ease of doing business,’ says ICT Agency of Sri Lanka (ICTA). Prior to the introduction of the CMC online tax payment system facility last Wednesday it was not possible to pay online CMC taxes by using the service of a mobile phone facility provider like the eZcash of Dialog. But thanks to the Wednesday’s launch this is now possible. CMC tax payments which do not require any supplementary documents/manual interventions could from Wednesday 8 January be made online. Among the tax categories for which this online payment could be made are the following: (1) Rates payments, (2) Trade tax, (3) Tax on businesses, (4) Market rental, (5) House rental, (6) Shops and boutiques rental and (7) Hawkers’ rental. So now not only those who possess debit or credit cards (Visa, Mastercard, American Express) others also are able to pay CMC dues online using currently the eZcash service of Dialog. Soon this will be extended to cover similar services of other mobile phone facility providers, says ICTA. The link for the current facility launched on Wednesday is as follows: Steps from the start by clicking the above link to the receipt of the ‘paid’ receipt print-out are simple. These steps include logging in and entering the payment type, CMC account number, the relevant street name and assessment number after clicking the above link. ‘Ease of doing business’ highlighted In the latest reckoning of ‘ease of doing business,’ a World Bank and International Finance Corporation (IFC) co-publication, places Sri Lanka atop South Asian Association for Regional Cooperation countries (SAARC). SAARC countries The publication ranks the eight SAARC countries under the index ‘ease of doing business’ as follows: Afghanistan – 164, Bangladesh – 130, Bhutan – 141, India – 134, Maldives – 95, Nepal – 105, Pakistan – 110 and Sri Lanka – 85. 189 economies ‘Doing Business 2014: Understanding Regulations for Small and Medium-Size Enterprises,’ the product of the World Bank staff with external contributions, ranks 189 economies in the world. The ranking is done by considering each economy’s regulations for thriving in businesses, particularly small and medium-size, under 10 /11 topics. Basis of ranking These topics are: (1) starting a business, (2) dealing with construction permits, (3) getting electricity, (4) registering property, (5) getting credit, (6) protecting investors,(7) paying taxes, (8) trading across borders, (9) enforcing contracts, (10) resolving insolvency and (11) employing workers. (The employing workers data are not included in this year’s ranking on the ease of doing business). While the ranking is from 1 to 189, the lower the digit indicating the rank, the higher the rank among the 189 economies. A high ranking on the ‘ease of doing business’ index means the regulatory environment is more conducive to the starting and operation of a local firm. This index averages the country’s percentile rankings on above-mentioned topics, made up of a variety of indicators, giving equal weight to each topic. The rankings for all economies are benchmarked to June 2013. Component of ‘paying taxes’ Although Sri Lanka is atop SAARC countries under the overall category of ‘ease of doing business’ it occupies the last place under the sub-rank “paying taxes”. If Sri Lanka’s position in the sub-rank, ‘paying taxes’ is raised from its current last position among SAARC countries, it will improve its overall ranking, namely ‘ease of doing business’. A comparison of Sri Lanka’s sub-ranking “Paying taxes” in ‘2013’ and ‘2014’ shows a four-position improvement. That is in ‘2013’ Sri Lanka in the sub-ranking of ‘paying taxes’ was 175 whereas in ‘2014’ it is 171. Under sub-ranking ‘Paying taxes’, the order as per ‘Doing Business 2014’ is as follows: Afghanistan – 98, Bangladesh – 100, Bhutan – 104, Maldives – 115, Nepal – 126, India – 158, Pakistan – 166 and Sri Lanka – 171. Tax returns in 76 countries Regarding paying taxes, the above-mentioned publication “Doing Business 2014” for a short name, says: “Today firms can file tax returns electronically in 76 of the 189 economies covered by Doing Business—from the taxpayer’s home, library, workplace or, as Russia shows, even from space. Benefits of online tax payment system Electronic systems for filing and paying taxes, if implemented well and used by most taxpayers, benefit both tax authorities and firms. For tax authorities, e-filing lightens workloads and reduces operational costs such as for processing, handling and storing tax returns. At the same time, e-filing increases compliance with tax obligations and saves time. By 2012, 76 economies had fully implemented electronic filing and payment of taxes. Online tax payment reforms in SAAR countries “In South Asia, India is the only economy (of 8) with a complete online system for filing and paying taxes. But in the past year Maldives and Sri Lanka have introduced online platforms for filing and paying labour contributions, easing the administrative burden for businesses of complying with labour regulations. Still, as of 2012 most companies were not taking advantage of the electronic payment options. Pakistan also has an established electronic system for filing and paying the corporate income tax and VAT, but uptake has been limited.”