Broadband internet tax-free:
Light trucks, motorcycles reduced:
The government yesterday unveiled a raft of new measures to boost small and medium enterprises and offered subsidised loans of up to 750 million rupees for agricultural and export-oriented industries.
Finance and Media Minister Mangala Samaraweeera said tax cuts on small commercial vehicles and motorcycles coupled with targeted loan subsidies should create another 50,000 jobs this year.
While tax reductions on light trucks and motorcycles came into effect from Friday, the abolishing of the 10 percent levy on broadband will kick in from September.
The minister said telecom operators had agreed to match the government’s gesture by loading a volume of 10 percent more data to their existing tariff packages and making internet access even more affordable.
“We want to make this an entrepreneurs’ paradise. Sri Lanka has a history of being a trading nation of very efficient, dynamic entrepreneurs for the last 2,000 years. “We are taking steps to harness the entrepreneurial skills of our people,” the minister said.
“They used to say, when (Neil Armstrong) went to the moon he found a Matara bath kade (eatery) already in operation there!”
He said the tax cuts and subsidies were aimed at empowering small businesses to build a strong economy and ensure that people were not dependent on handouts.
With immediate effect, the government is slashing the taxes on light trucks and single cabs by 300,000 rupees and is abolishing a 90 percent excise duty on motorcycles with an engine capacity of 150 cubic centimetres or less.
He said the move was aimed at improving transportation particularly in the rural sector and lift the small-scale enterprises across the country.
“This is the first time such a targeted package of measures is being unveiled,” the minister said
The minister said he expected economic growth to be between 4.5 to 5.0 percent this year despite the twin effects of the floods in May and the ongoing drought in several parts of the island. Sri Lanka’s economic growth last year was 4.4 percent.
Subsidised loans were being offered under eight categories with the aim of boosting small scale enterprises as well as export-oriented medium scale industries.
“We want the country to be a paradise not only for foreign investors, but for our entrepreneurs too,” he said. The new measures also include subsidised loans for one million homes to set up solar panels on their roofs and generate their own electricity. Each home will be offered Rs 350,000 repayable over five years with an interest rate of 6.0 percent.
The government is setting aside Rs 1,500 million to subsidise solar panels under the clean energy drive across the country.
The government is setting aside a total of 4,475 million rupees to subsidies loans under the new scheme unveiled by the minister Thursday.
Finance State Minister Eran Wickramaratne said the package was presented ahead of next year’s budget, and he hoped the government could announce more concessions when the 2018 budget is unveiled in November.