The reintroduction of the SVAT (Simplified Value Added Tax) system will be a major burden on the export sector, Free Trade Zone Manufacturer’s Association (KEPZ) President and ATG Ceylon Director Fazal Abdeen said.
Speaking at their 37th annual general meeting were Abdeen was re-elected he said that it takes a longer time to recall VAT and the additional paper work is really discouraging. “Due to this exporters face tremendous hardships and we have to keep leave a side around 16% of earnings with the inland revenue for almost four months.”
The Finance Ministry said SVAT which was to be implemented from April 1, was postponed. The Ceylon Chamber of Commerce said it welcomes the decision by the Finance Ministry.
The move followed joint submissions made by the Ceylon Chamber of Commerce, Joint Apparel Association Forum, Exporters Association of Sri Lanka, The Lanka Fruit and Vegetable Producers, Processors and Exporters Association, National Chamber of Exporters, National Chamber of Commerce and Sri Lanka Shippers’ Council.)
However Abdeen said that fresh moves are being taken to re-implement this.
He said the government is also giving mixed signals. “The Prime Minister says that Sri Lanka should not concentrate on Apperals but look at high tech employment generating industries.”
Abdeen said that if the government is keen to generate more employment and additional export revenue, mass producing industries like apperals should be given preference. “When you high tech industries employment generation is less.” He also said the government should not press the wrong buttons and upset the business community.
He said the Zone has an acute employment shortage and youth don’t like to work in the Free Trade Zones. “The tele dramas have also demeaned the FTZ worker and they too are responsible for this.”
Meanwhile FTZMA Secretary Dhammika Fernando said high-tech waste, sludge oil waste management and clearing and disposing them is still a major issue at the Katunayake Export Processing Zone. “There is a dumping yard but not to dump high tech waste and this issue has to be addressed soon.”
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