Land squabbles

DEVELOPMENT can be a many-edged implement. Recently it was declared in Parliament that the Government had outright sold land to the Shangri-la hotel chain for a US$ 500 million project and that another 10 acres had been sold to another Chinese company. This 20 acre plot is prime land facing the Galle Face that is close to the heart of many people.

It was reported over the weekend that new legislation is being introduced to remove existing legal impediments in the sale of land to foreigners and foreign companies to develop State land in major towns. Already around 10,000 acres of land are owned by foreigners.

The current system of levying a 100% tax on land transfers to foreigners will be removed by introducing a special land tax in order to prevent the sale of land at inflated prices to foreign buyers, making huge profits completely tax free and thereby cheating the Government of revenue while also breaking Immigration laws.

It is no secret that methods can be found to evade 100% tax in the sale of land to foreigners. Under the present system, a foreigner or a foreign company can buy tax-free land if their investment for the whole project is over US$ 10 million. The aim of introducing new legislation is to tackle all these issues, closing loopholes in the law.

According to the proposed legislation which is still in the drafting stage, the State will move away from the practice of issuing long-term leases as it does not serve any useful purpose and as it becomes an unnecessary burden on the Government. It is commonly considered that public land can be leased for a maximum of 99 years.

The Chief Valuer’s valuation will be treated as the value, enabling the Tender Board to make its selection of purchases of land on the basis of the highest price offered. The Urban Development Authority (UDA) and Sri Lanka land Reclamation and Development Corporation (SLLR&DC) will identify lands they could utilise for development projects over the next 10 year period and offer the balance lands to investors on outright sale by public tender. If lands belonging to the UDA and SLLR&DC continue to remain idle for years due to lack of funds for development, basic infrastructure facilities like roads will be provided and these lands will be sold by calling public tenders.

The attempt to clarify land laws is a welcome one, but there must also be transparency in the new laws that are drafted out. The accountability when calling tenders is another issue that has been in question where politically or economically powerful people can ‘fix’ the tender process and gain prime land at a lower cost.

When it comes to land deals in prominent archaeological or scenic areas of the country, one must remember the people who cannot afford to go to expensive resorts or other establishments built on these lands, nonetheless as citizens of this country have the right to visit them. For example, the idea that prime land like that in front of the Beira Lake or Galle Face or even in the mountain areas be sold so that normal citizens can no longer have access to it is a tragedy. There is also a certain amount of negativity in the fact that future generations will not be able to have access to this land either.

In city areas such as Colombo, there must be land allocated for parks and other public areas, which is a huge scarcity at the moment. All the prime land cannot be sacrificed for the sake of ‘development’ and environmental considerations must be taken into account.