Sri Lankan parliament passes bill to impose tax on rich to garner quick revenue

Without any voting, the Sri Lankan parliament has passed a retrospective surcharge bill, that will impose a surcharge tax on rich people.

A 25 per cent windfall tax will be imposed on those companies and individuals who earned more than 2 billion Sri Lankan rupees in the financial year 2020-21.

The government expects to earn a revenue of 100 billion rupees through this tax that was proposed by former finance minister Basil Rajapaksa.

Gotabaya Rajapaksa has also constituted an expert panel to combat the country's worst economic crisis in decades.

“Among the responsibilities that the presidential advisory group will undertake are to engage in discussions with relevant Sri Lankan institutions and officials engaging with the IMF, and to provide guidance that will address the present debt crisis and lead towards sustainable and inclusive recovery for Sri Lanka,” as per a statement issued by the president's office.

People in Sri Lanka are protesting against the Rajapaksa family due to shortages of fuel, power, food, and medicine.

Outgoing finance minister Ali Sabry has said, "We must look at how to structure the $1 billion international sovereign bond payment maturing in July."

"We must have political stability to find solutions to the financial crisis," Sabry said.

"We must discuss with the World Bank and we must have a bridge-financing plan with the ADB. If we don't have stability, who will conduct these talks?," he said, referring to the Philippines-based Asian Development Bank.

According to Sri Lanka's central bank, reserves dropped 16 per cent to $1.93 billion in March.

Financial authorities in Sri Lanka are unable to secure more commercial loans because of credit downgrade. The nation can default on $51 billion foreign debt.

(With inputs from agencies)