President Ranil Wickremesinghe yesterday told Parliament that amending the existing tax mechanism is under consideration and will be presented to the International Monetary Fund (IMF) in the first review of $ 2.9 billion EFF program in June this year.

The Government and the IMF will review the programme every six months. The first review will take place in June. “We have already focused our attention on amending the existing tax mechanism. The Treasury is already in the process of preparing amended proposals. Further, intellectuals and economic experts have already submitted their views in this regard, which we hope to discuss, and reach an agreement,” the President said in his special address in Parliament on the Extended Fund Facility which the IMF Executive Board approved on Monday.

“We are discussing with the IMF to include these tax reforms in our plans at the review in June. In addition, we are discussing the other policy reforms which we think are necessary at present,” the President added.

“Some people try to portray that these issues can be solved through confrontations. However, these problems have to be solved through caution, care and wisdom,” said Wickremesinghe in an apparent response to continuous protests in the country by trade unions against the new tax regime which they say is unbearable.

On Monday IMF Senior Mission Chief for Sri Lanka Richard Breuer said at 8.6% of GDP, Sri Lanka is amongst the countries that collects the least amount of fiscal revenue in the world.

The President also told Parliament that the IMF-approved plan should be implemented and completed in four years. “However, depending on our strength and determination, we should be able to finish it in three to three and a half years. Let’s give it a try. Let us put in the effort,” the President told the House.

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