Govt.’s “gambling gene” gives massive tax concessions to casino: Harsha
Saturday, 20 July 2013 00:37
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Slams 10-year tax holiday for Packer Project, commends JKH for refusing a free ride
Pledges to defeat Bill in Parliament, calls for tax reform
By Uditha Jayasinghe
Calling it a manifestation of the Government’s “gambling gene,” UNP MP Dr. Harsha de Silva yesterday rolled the dice on defeating a decade long tax holiday given to Australian gaming mogul Kerrry Packer’s US$ 350 million casino project in Parliament.
The Sri Lankan Government approved the tax concessions through a midnight gazette notification released on Thursday, which resulted in the ire of United National Party (UNP) MP and Economist Dr. Harsha de Silva.
Speaking to the media, Dr. de Silva insisted that the US$ 350 million project was detrimental to the country as it did not bring in any income through taxes and should never have been given approval.
A copy of the Gazette notification obtained by Daily FT shows that in addition to the 10-year income tax holiday, the casino will be charged only 6% tax for another 12 years. It also details exemptions from Customs Duty, Construction Industry Guarantee Fund Levy, Port and Airport Development Levy, VAT, PAYE tax for foreign employees (five years), Withholding Tax on foreign loan interest and Tax on Dividends for 11 years.
Comparing Sri Lanka’s concessions with the rest of the world, Dr. de Silva pointed out that Macau, which is the one of the largest gaming regions in the world, charged 40% tax while Singapore, Malaysia and the Philippines also had high rates.
“Sri Lanka goes into the record books as the first country in the world that exempts casinos from tax,” he charged, adding that there were massive irregularities in the deal including the licensing of the casino. He also commended John Keells Holdings, who were given tax concessions in a separate gazette notification also released on Thursday night, for refusing to take tax concessions for their proposed casino.
“The regulations offering tax relief are not the same for the two companies. For the Packer project, the casino gets a tax free ride. But for the John Keells project, the tax concessions are only for the hotel and not the casino. I commend the stance taken by John Keells for refusing a tax free casino. I think that is bigger CSR than anything else. Mind you, John Keells is a local company employing local people whereas they (Government) have given tax holidays including PAYE tax concessions for foreign employees. Why the difference?”
Dr. de Silva insisted that when the tax concession reaches Parliament, the UNP would do their best to defeat it and called on ministers of the Government to also join them.
“The UNP is a responsible opposition. The UNP does not say no to everything. We all want a better future and in that process, if the Government wants to give tax concessions, we can discuss that, we can have differences but by and large, we will not be against such projects. But let me be clear here – the Government is completely opposed to the tax concessions given to James Packer’s casino in Colombo.”
Revisit the country’s unfair tax regime, he stressed, that while the public was being taxed on essential items such as onions, salmon tins and dhal, the rich and powerful were allowed to have a free ride.
“I appeal to every Member of Parliament who is concerned about the people to vote against this project because ultimately by giving tax concessions for people to make billions of rupees, the lost revenue has to be recouped from the people. The people are taxed to the absolute core.”
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