2019 Budget- “Empowering the People & Nurturing the Poor”

2019-03-06 at 17:26

BUDGET SPEECH 2019- “ENTERPRISE SRI LANKA – Empowering the People and Nurturing the Poor”

The Gamperaliya Scheme

* Allocation for 2019 increased from Rs.200 million to Rs.300 million per electorate. Towards this, Rs.48,000 million has been allocated for 2019.


“Enterprise Sri Lanka”

* This scheme will be aggressively promoted through awareness and other programs Island-wide. National Youth Council certificate holders will be given preference for Enterprise Sri Lanka Loans.

* “Enterprise Sri Lanka” Schemes, the small entrepreneurs are still faced with the challenge of providing collateral as demanded by the Banks. A Fund under the Central Bank of Sri Lanka to be established to provide guarantees to the SME Sector, for which allocations will be made.

* Complaints are lodged of Bank officers discouraging new entrepreneurs. Therefore, a Call Center – ‘1925’, will be set up to receive such complaints.

* “Enterprise Sri Lanka” customers will be linked with relevant Government institutions such as ITI, ICTA, EDB, and the universities, along with larger private sector companies, to build capacity in these areas.


Growth Through Supporting Livelihood Development

* The program will be extended to 5 Districts – Hambantota, Kurunegala, Puttalam, Ratnapura, and Kegalle.

* The government will invest in setting up modern climate-controlled warehousing facilities in Katunayake, Embilipitiya, Jaffna, and Keppetipola. Private enterprise will be invited to manage and operate facilities. Additionally, private investment in climate-controlled logistic facilities will be facilitated by removing up-front costs in establishing such facilities.

* The “Diri Saviya” Loan Scheme will be extended to support those in small scale animal husbandry activities and the self-employed who engage in manufacturing activities.

* To facilitate replanting and new planting of rubber, we have doubled the incentives given, for which Rs.800 Mn has already been allocated.

* At present local tyre producers have no access to testing and prototyping in the country. The Export Development Board will facilitate the private sector, to establish a fully-fledged research facility.

* The existing licensing mechanism for the processing of desiccated coconut, coconut chips, charcoal, etc., will be re-visited with a view to simplification.

* The ceramic industry has faced similar issues in mining and transport of raw materials such as clay. It is proposed to review these regulations with a view to facilitating the industry whilst ensuring necessary environmental protections.

* All Cinnamon Exporters will be subjected to certified quality control testing, at the point of export. Those who fail such certified tests, will be supported to improve their operations within 12 months, as part of the Export Market Access Program.

* Work will commence on the Wayamba Maha Ela, Minipe and NCP canals,which are expected to facilitate the movement of water from the Moragahakanda Reservoir to the water scarce regions, ensuring cultivation during both the Yala and the Maha seasons. To undertake these activities, we have already allocated Rs.12,000 Mn. Further, in order to urgently resolve the wage issue of the plantation workers, an acceptable solution with the Tea Board will be implemented on an urgent basis.

* The Nangwamu Lanka” Micro and Small Enterprise Development Program has been proposed.

* Further Rs.2,410Mn has been allocated to complete the canals and head works of 7 major projects in 2019, including the Deduru Oya Project, the Menik Ganga Reservoir Project and the Morana Reservoir Project, which will directly benefit almost 21,000 families engaging in Agriculture.

* Rs.1,300Mn has been allocated to complete the on-going rehabilitation of harbors, anchorages & landing sites, and work will also commence at 2 new harbors at Point Pedro & Pesalai and an anchorage in Mandathivu.

* The artisanal long liners and multi-day boats will be supported to improve their stowage facilities and safety standards. As such, the Government will bear 50% of such cost, while the “Ran Aswenna” Concessionary Loan of the “Enterprise Sri Lanka” Scheme, could be accessed to finance the balance 50% of the cost of acquiring and installing Chilled Sea Water and Refrigerated Sea Water Systems.


A Caring Society

* We will further support the primary school childrens’ nutrition effort by providing a free glass of milk to students in all rural schools in the country.

* We will provide all such houses in the country with sanitation facilities within two years, benefitting almost 1
million of our citizens.

* Many Bus Terminals and Railway Stations’ sanitary facilities are in atrocious conditions. Funds will be allocated to improve them. Such facilities will be provided for men, women and those with special needs. Once built, the private sector will be invited to maintain these facilities.

* Commercial establishments with more than 250 employees will be encouraged  to provide child-care facilities. Selected schools will be supported to establish After-School and Vacation Centres within the school itself, while the private sector will also be facilitated to establish child-care facilities, through the “Rekawarana” Concessionary Loan Schemes of “Enterprise Sri Lanka”.

* The Ministry of Women and Child Affairs will issue necessary guidelines and the regulations for establishment and operation of Child-Care Centers, After-School & Vacation-Carecenters, and similar facilities.

* Private sector to be encouraged to support working mothers, by allowing 50% of the salary cost of the mandatory 3 months maternity leave granted, as an additional deduction, in calculating their corporate taxation, subject to a maximum of Rs.20,000/= per employee per month. This will be extended to an additional deduction of 100%, for the 4th month of maternity leave, if so granted. The concession would apply for a 5 year period.

* A sequenced approach to enable greater participation of women in boards of listed companies will be proposed. The Securities and Exchange Commission will be encouraged to implement this proposal.

* Parliament will support amending the labor laws to allow parttime, flexi hours, home-working, etc., which will facilitate more women to be active participants.

* While strengthening the National Elders Secretariat, the NSE will be urged to create a proper regulatory framework and we will also incentivize the private sector to invest in elder-care facilities by making available to them, the
“Rakewarana”concessionary loans of “Enterprise Sri Lanka”.

* At present, differently-abled individuals are paid an allowance of Rs.3,000/- per month. Whilst increasing the allowance to Rs.5,000/- per month, we will expand funding to accommodate almost the 72,000 eligible low-income individuals. Rs.4,320 Mn has been allocated for this. This allocation will enable us to eliminate the waiting list.

* In order to encourage more inclusive employment, private entities that recruit at least 5 persons with disabilities, will be provided with a salary subsidy of 50% of the salary per person, up to an upper limit of Rs.15,000/- per person per month for a period of 24 months.

* Only 21,000 CKDu patients are paid an allowance of Rs.5,000/per month. We will expand the scheme to cover a further 5000 patients, thereby eliminating the waiting list, for which Rs.1,840Mn is allocated.

* To rehabilitate inmates, 2 Kibbutz stylefarms, under the Prison Authorities, with the required facilities, will be established in Ambepussa and Weerawila. We encourage civil society/private sector to participate in these ventures.

* Work on 15,000 brick & mortar houses in the Northern and Eastern Provinces will commence in 2019, with an allocation of Rs.4,500Mn already made. A further Rs.5,500Mn will be made available for these initiatives. On-going work to address the issues of re-settlement of Muslims, who were once forcibly evicted from the North will continue and resources will be channeled accordingly.

* Several middle-income housing projects, which are reasonably priced, have already been completed, while a few more are about to be completed or about to start work in 2019, in Wadduwa, Ragama, Yakkala, Kundasale, Borella, Pannipitiya, etc., by the NHDA and the UDA.

* The Government will launch a concessionary loan up to Rs.10Mn, at a 6% interest rate with a repayment period of 25 years called “Home Sweet Home” Loan. This will be for young couples buying or building their first home. This “Enterprise Sri Lanka” loan scheme will be extended to also purchase mid-range apartments and houses built by
private entities.

* Migrant workers will be introduce the “Sihina Maliga” loan scheme, in order to make their ‘dream home’ a reality, under “Enterprise Sri Lanka”. Migrant workers, registered with the Foreign Employment Bureau and currently working abroad, will be able to get a loan of Rs.10Mn where the Government will bear 75% of the interest cost and where the tenure of the loan will be a maximum of 15 years, with a two year grace period. As a further measure to
support families of migrant workers the International Telecommunication Levy will be removed.


Integration to Global Markets – Exports

* The Export Market Access Scheme, and the National Export Strategy will continue this year with Rs.400 Mn. allocated for the Export Market Access Program and Rs.250Mn will be allocated for the National Export Strategy.

* The Singapore FTA, will be reviewed, on-going FTA negotiations with India, China, & Thailand, and build on learning from the Singapore FTA process will be concisdered.

* A “Break into India” and “China Market Entry Strategy” are being prepared, building on success stories from Sri Lankan enterprises in those markets. This will be further supported by establishing Trading Houses for priority sectors, in collaboration with the private sector in key markets.

* Ports and Airport Development Levy for machinery and equipment items to be reduced to a maximum of 2.5%. I also propose an accelerated Cess reduction program for intermediate goods that drive up costs in sectors such as,
the Construction Sector, Tourism, and Manufacturing. These items will have Cess phased-out over a 3 year period.

* A Trade Adjustment Program has been formulated, which will provide vulnerable firms and workers with financial support to meet costs of upgrading technology and training, respectively. We will also ensure that 10% of all HS codes, considered to be sensitive items, will not be subject to a complete para-tariff phase-out. Necessary improvements to the National Quality Infrastructure are also being made in order to ensure quality standards of all products including imported products.

* Rs.500 Mn over 2 years to be allocated for the implementation of the Trade Adjustment Program.

* A Enterprise Innovation Program will support the development of innovative new products and technology by Sri Lankan firms. The Program will be implemented over 3 years, providing matching grants for proof of concept, prototyping, R&D and technology adoption.

*Script-less Sri Lanka development bonds will be introduced and coupon stripping of Treasury bonds will be enabled.

*An incentive package to attract high value investments is proposed. This includes significant capital allowances of up to 150% of investment value and removal of up-front taxes for investments over USD 50 Mn, USD 100 Mn & USD 1,000 Mn.

* Subsequent to consultations with the private sector, we propose to make some adjustments to the Inland Revenue Act to facilitate implementation and address some pertinent concerns of industry. These are outlined in the technical notes.

* Work on the Bingiriya and Wagawatte Industrial Zones will be supported to further facilitate our export drive.

* Industrial estates under Industrial Development Board in KKS, Manthai East, Paranthan, Kondachi, Kinniya,
Samanthurai & Trincomalee will be introduced.

* The “IT Initiative” will be expanded to facilitate the “Arts to Science Internship” Program, where the industry will train 1,000 unemployed, mostly Arts Graduates through internships, for an year in IT-BPM, KPO firms, where 50% or up to a maximum of Rs.25,000/- of the monthly salary for a period of 12 months, will be borne by the Government. Rs.300Mn has already been allocated.

* A Revenue Intelligence Unit will be established at Ministry of Finance, to take steps to assist our main Revenue Collection Departments, such as, Customs, Inland Revenue and Excise, to broaden their revenue collection bases, increase total revenue collected and minimize leakages & evasion.

* Customs will launch the Authorized Economic Operators Program in 2019, which will provide expedited clearance for identified low risk traders and clearing agents. Risk-based clearance of this nature will enable Customs to focus resources on higher risk cargo, whilst facilitating compliant traders.

* The Government has imposed administered prices for certain items for consumer protection. However, it is also necessary to enable reasonable price adjustments to ensure unhindered supply. Towards this end, the Government will introduce a mechanism to review administered prices on a quarterly basis, to take into account, exchange rate fluctuations and other variables.

* The Gem and Jewelry Industry will be supported with the PAL and Customs Duty on the importation of machinery used in lapidaries and the PAL on the un-cut gems imported, will be reduced from 7.5% to 2.5%.

* Recognizing the costs inherent in the tourism sector, Nation Building Tax (NBT) on foreign currency receipts by tourist hotels registered by the Sri Lanka Tourism Development Authority (SLTDA) will be removed.

* It is proposed to make it mandatory for travel agents to remit funds to hotels in US Dollars when invoiced in US Dollars. The Central Bank will issue directions in this regard.


Knowledge Driven Skilled Society

* The government’s program of ensuring “13 years of Education” for every child will be further supported this year. As such, we have already allocated Rs.32,000 Mn. to improve the laboratories, class rooms, libraries, sanitary & water facilities, teachers’ quarters, etc., 100. At the same time, the implementation of the Continuous Professional Development (CPD) in teachers, facilitated by the infusion of technology, will be supported using existing facilities. These courses will be conducted during school holidays.

* Curricula will be modernized with a focus on more analytical and creative learning, as opposed to rote learning. Our future investments will be guided by the STEM+A master plan, which is being finalized. This will allow students to pursue a combination of subjects such as Mathematics with Music or Biology with English.

* Scholarship for Educational Excellence – SEE Fund will be launched, to facilitate the country’s top performers at Physical Science, Biological Science, Technology, Commerce and Arts, at the Advanced Level Examinations held each year to pursue their undergraduate education at top universities, such as Harvard, MIT, Oxford, Cambridge, etc. The first batch will be chosen from the results of the 2019 ‘A’ Levels in August. 14 scholarships will be given this year to those who top their respective areas. Those selected will be required to return and serve at least 15 years in Sri Lanka. We will also expand the scholarships given in the coming years.

* Investment in pre-school education has been neglected. We wish to encourage private investment in this sector, with the Government taking a more robust role as a regulator, by defining and ensuring compliance with minimum quality standards.

* The Government will introduce a legal framework for regulation and governance of pre-school education in Sri Lanka. A national curriculum framework for pre-school education will be implemented along with enhancement of teacher training and working conditions.

* Rs.25,000 Mn. has been allocated to meet the infrastructure gaps at our universities with investments, in Theatre Complexes, Professorial Units, Departmental Complexes, Libraries and Canteens. To complement the Medical Faculties at the Wayamba and Sabaragamuwa Universities, professorial units will be established at Kuliyapitiya and Ratnapura Hospitals, while a Faculty of Allied Health Science at the Ruhuna University will also be established, which will enable students to pursue careers in medical related services, which is an urgent requirement in our country. A “State of the Art” Laboratory for research in areas such as cancer, diabetes and infectious diseases will be set up at the Medical Faculty of the Sri Jayawardenapura University.

* A loan scheme, “My Future” under “Enterprise Sri Lanka” will be introduced which enables students to pursue Undergraduate Education at Non-State Universities. A student can draw up to Rs.1.1 Mn. at zero interest, with the repayment starting only after 2 years of graduation, to be repaid over a period of 12 years. Rs.200Mn has already been allocated to meet the interest subsidy.


Skills for Work

* Selected Vocational Training Institutions, where the resources are not fully utilized, will partner with selected industry associations in Information Technology, Construction, Tourism, etc., to conduct training as required by the industries themselves.

* There is also a requirement to promote Tamil Medium Teacher Training as a matter of priority. I propose Rs.400Mn to be provided to the Ministry of National Integration, Official Languages, Social Progress & Hindu Affairs.

* We will support CIDA to train the required skilled and semi-skilled workers for the Construction Industry. Rs.300Mn has already been allocated.

* The private sector is invited to offer internationally accredited training courses for Nurses, where the Government will provide a stipend of Rs.10,000/- per month per trainee, for a period of 2 years. These qualified Nurses will be able to seek employment in nongovernmental institutions. A similar apprenticeship program will be encouraged for pharmaceutical professionals. Pharmaceutical companies will hire science graduate apprentices for a 1 year program,
to be accredited by an appropriate institution, and the Government will provide a stipend of Rs 15,000/- per month per apprentice for that year. The success of such apprenticeship programs will enable replication for other industries going forward.

* The Sri Lanka Army has come forward to support the Government’s drive to effectively train those interested, especially those from low income backgrounds in agriculture, animal husbandry, ornamental fish, use of heavy machines such as Backhoe’s, Motor Graders, Dozers and also undertake training of electricians, welders, air-conditioning technicians, catering assistants, stewards, carpenters, masons and plumbers. These training courses will be NVQ certified and the training will be undertaken at selected Army camps. The trainees will be given the stipend and the concessionary season ticket already made available to VTA trainees.

* The Army will also train our youth in selected sports at their camps in different parts of the country.


A Healthy Society

* Home Dialysis Machines will be provided, while also strengthening the Hemo-Dialysis Centres in 45 hospitals, together with RO Water Plants.

* Early detection through Door-step Screening will be further strengthened in the most CKDu vulnerable districts in the country.

*  The Rabies Control Program to eradicate Rabies from the country, will be strengthened by also engaging the Non-Governmental Organizations, in this effort as well. A comprehensive sterilization program for stray dogs will be introduced by the Dept. of Animal Production and Health (DAPH). An allocation of Rs.100Mn will be made.

* Sports is an integral part of a healthy society and also builds leadership and team spirit. We have already allocated
Rs.3800 Mn. towards sports. In addition, I propose: The Bernard Aluwihare Sports Stadium in Matale, and the Weerasinghe Mallimarachchi Playground in Kolonnawa, will be upgraded to support our rural youth in sports. Towards this Rs.300Mn each will be provided over 2 years.

* The National Olympic Fund will be enhanced to support sports, such as Athletics, Volleyball, Table Tennis, etc


Culture of Research & Development

* “Science at Work” Challenge, will be introduced where challenges in the following 5 themes will be posed to the Scientific Community to work on, and viable solutions will be supported to be implemented with the allocation of the required finances.
(a) Reducing post-harvest losses in agriculture and fisheries
(b) Creating global benchmark yields in Paddy and Minor crops
(c) Addressing Human-Elephant conflict
(d) Create a 1,500 sq.ft. low-cost livable Housing Units
(e) Value addition to local medicinal plants and bio products to position them as Nutra-ceuticals.


Making our Cities Smarter

* Under the Urban Re-generation Project (URP), over 8,000 houses have already been completed and over 7,500 houses are being constructed, while another 5,000 houses will commence construction. Rs.8,000Mn is allocated.

* “Sukithapurawara” Township Development Program which covers all 9 Provinces is being implemented to enhance inclusive and sustainable urbanization in the country. Rs.3,000 Mn. has been already allocated. A further Rs.2,000 Mn. will be allocated to facilitate this Program.

* “Beira Lake Cleaning”, a project that initially commenced in 2000 with US aid, will be completed in order to restore water quality.

* Solid Waste Management that has been a key issue in the city of Colombo is now being addressed with Government investments in Aruwakkalu with an investment of almost Rs.7,600 Mn. in 2019. Private sector investments are also in progress.

* Flood and Drainage Management, Enhancement of Drainage Capacity in the Colombo Water Basin, Beira Lake Linear Park & Beddagana Park and the Weras Ganga Projects are designed to mitigate floods within Colombo and the Greater Colombo areas, for which, Rs.10,900Mn is already allocated.

* Traffic management measures, rehabilitation of major drains & flood reduction measures, urban upgrading, restoration & adaptive re-use of historic & landmark buildings and coastal erosion reduction measures for selected
areas. An allocation of Rs.9,225 Mn. has been made.

* The iconic old Town Hall building in Jaffna was destroyed during the conflict. It is now a timely requirement to reconstruct the Jaffna Town Hall with Rs.700Mn.

* Whilst safeguarding and protecting our hill country heritage, special attention will be paid to nurturing crafts, architecture, cultural aspects, traditions, indigenous medicine and places with historical value, inherent to the Hill country.

* The Bogambara Prison – a heritage building – will be re-developed and re-positioned as a Public Space in 2 years. Rs.750Mn will also be provided towards this work, this year.

* Township Development work in Kalmunai, Valachanei, Thalai Mannar & Samanthurai will be further supported.

* All Government and Private commercial buildings in the country will be “Disability Friendly” by 2023. It is envisaged that this will be a mandatory requirement for new building approvals from 1st January 2020. All State buildings will be made “Disability Friendly” by 2022.

* In line with the objective of increasing the reach of pipe-borne water at least to 60% by 2020, we have undertaken Rs.45,000 Mn worth of water projects covering all Districts. We will extend our support further, through community-based Water Supply Schemes – “Praja Jala Abhiman” – to cover 1,000 villages, where almost 200,000 families will benefit in the next 2 years.

* Our public transport system needs urgent attention, with investments made in a more integrated manner.

* The “Sahasara” Bus Modernization Program will get priority in the next 5 years to transform bus services across the country. Private Sector Bus Employees will now have better job security with EPF and ETF contributions being made and being eligible to get loan facilities as an incentive for better service towards passengers. A Revenue Support Fund will be established as a transitional arrangement to enable bus owners to be paid on a monthly basis for the kilometer operated, rather than the highly unsatisfactory competition that exists, causing inconvenience to the public, accidents and chaos on our roads.

* Modern multimodal passenger terminals will become a reality starting from Makumbura and will include Kandy, Kadawatha, Pettah and Moratuwa.

* SLTB’s fleet will be expanded with the addition of 250 buses with safety & user-friendly standards in the next 2 years. SLTB will also introduce buses that are more suited for those with special needs.

* A concessionary loan “City Ride”, under “Enterprise Sri Lanka”, will be introduced, where the Government will bare 75% of the interest cost for private bus fleet owners to expand their fleets by a total of 1,000 luxury buses.

* Three-wheelers will be supported through a concessionary loan “Mini Taxi-Electric Three Wheeler” under “Enterprise Sri Lanka” Loan Scheme to upgrade into electric threewheelers and small cars that will be more environmentally friendly, safer and more comfortable. Government will bear 75% of the interest rate and the existing three-wheeler should be disposed.

* The  private sector to lease/rent Sri Lanka Railway’s carriages, and improve their facilities in the 4 main lines.

* Work on the Colombo City Light Rail Transit will commence in 2019, connecting Malabe to Fort, for which Rs.5,000 Mn. is already allocated.

* The Southern Expressway’s extension and the Outer Circular Road will be completed in 2019, and work on the Central Expressway Section I and III will commence, while continuing work on Section II. To further improve connectivity, work on the Ruwanpura Expressway, connecting the Ratnapura District to the Southern Expressway, will commence in 2019.


Public Sector Service Delivery

* Monthly salary of a lower grade government employee will increase from Rs. 11,730 in 2015 to Rs. 21,400 in 2020. The government will implement the report of the Special Salary Commission appointed by HE the President as soon as the technical committee recommendations are out.

* A pension revision proposed, having incorporated the first 2 phases of the Public Administration Circular 03/2016 to the basic salary obtained by the pensioner, at the time of retirement with effect from 1st July 2019. Proposed to allocate an additional sum of Rs.12,000 Mn for that revision this year, to rectify the pension anomalies. This will benefit around 585,000 affected pensioners. For an example, a lower grade government employee’s pension will increase by at least Rs.1,600/- per month. A Grade I teacher will have a Rs 4,600/= increase in the monthly pension
and the pension of a Secretary to a Ministry will increase by Rs.12,000/- per month. This is based on 25 years’ service and retirement prior to 31st December 2015.

* Commando Allowance, Uniform Allowance, Rent Allowance and the Good Conduct Allowance of the Armed Forces, where some have not been increased in some instances, for over 20 years, will be increased from 1st July 2019.

* The Commission to Investigate the Allegations of Bribery or Corruption, will be strengthened, especially to engage in Awareness programs amongst the Public.

* The digitalization of Government procedures has already begun and will continue into 2019 as well, with focus on eGovernmental Digital Document Management, towards a society with better Governance and Accountability and over Rs.800Mn has been allocated to implement these activities.

* Entrepreneurs in “Gramashakthi” Production Villages will also be further assisted through access to technology.

* Youth empowerment through enhancement of skills will be further supported by the ‘Smart Sri Lanka” project.

* The Fiscal Management Act No.3 of 2003 will be amended, with a view to strengthening Fiscal Rules with legally
binding Fiscal Targets, a clearly defined escape clause and correction mechanisms, in case of a target breach.

*  The new Monetary Law Act as proposed in the last Budget has been drafted. This is a landmark legislation that will introduce disciplines to help eliminate the monetary and fiscal profligacy that has plagued our country for decades.

* Gender Based Budgeting – the Government is committed to gender responsive budgeting and initial steps have already been taken by issuing an addendum to the budget call of 2018 with the objective of improving the participation of women in the workforce. 12 key performance indicators have been identified and action will be initiated to achieve this.


Social Safety Net

* An objective will be developed with transparent and measurable criteria, to streamline the “Samurdhi” Program in a more effective manner, which will actually facilitate the addition of around 600,000 deserving households. Rs.10,000 Mn. has been allocated for this.

* All Samurdhi beneficiaries to withdraw up to Rs. 30,000/= each from their “Samurdhi” Compulsory Savings in banks, in two installments in April and November this year, as a dividend for the Sinhala/Tamil New Year and Christmas.

* The Government to take steps to introduce a National Pension Plan with a sustainable financing structure.


Clean, Green and a Sustainable Environment

* Conservation and Protection will only be effective if society is an active part of this endeavor. As such, community-based “Green Clubs” will be established in every Divisional Secretariat, consisting of volunteers, especially students. These Clubs will be engaged, especially to expedite the planting of 2.5 million trees, cleaning beaches, separation of waste etc.

* Investments in creating “Green & Clean” Public Spaces such as, “Haritha Udyana” (eco-friendly parks), will
enable the greening of our cities and villages, whilst facilitating stronger bonds in communities. We will partner the Colombo Municipal Council in its ‘City Beautification’ endeavor. Rs.1000Mn. has already been allocated.

* The “Nilwala Eliya” Model Park and Mega Zone will also be completed in 2019.Rs.1,000Mn has already been allocated.

* Mangroves are eco-systems that stabilize coastlines, provide critical habitats for many animals and sequester more carbon-dioxide than other kinds of forests, making them indispensable in combating climate change. However, our mangroves are fast receding and as such, we will support the replanting of mangroves, where nurseries will be established at the first stage.

* Rs.2,000Mn will be channeled to facilitate the rehabilitation of houses and other infrastructure facilities affected by disasters, while also introducing disaster resilient houses in selected high-risk districts.

* In the recent past, we have experienced the impact of droughts and floods resulting in the loss of lives, loss of income and property. The victims of such disasters, both individuals and corporate, will have to be compensated immediately and to mitigate the impact of the loss and to facilitate a more efficient and effective method of doing so, we will allocate Rs.20,000 Mn. over the medium-term as a Disaster Management Contingency Fund.

* The Ministry of Women, Child Affairs and Dry Zone Development will be allocated Rs.250Mn to enhance initiatives to develop the dry zones, in addition to the “Gamperaliya” and other development initiatives, already in place and proposed.

* The proliferation of single use plastic products, including plastic bags, packaging, plastic bottles, lunch sheets, have led to significant environmental costs. As a first step in introducing appropriate regulation for this sector, it will be mandatory for any entity, manufacturing or importing single use plastics (as defined by the Central Environment Authority) to register with the Ministry of Industry and Commerce before the 1st of September 2019.

* Sri Lanka will develop a consolidated plan for Marine Conservation to protect and sustainably manage its marine resources. We will progress towards declaring the Exclusive Economic Zone of Sri Lanka as a Marine Conservation Area, entailing measures to sustainably manage marine biodiversity, to enhance socio-economic benefits to the country.


Religion, Arts and Culture

* A fair scheme of royalty payments for artists will be introduced, so that they continue to benefit from their creations, when such creations are aired/telecast or otherwise publicized. This will protect their creations and provide them with a continuous income source. To further support this initiative, we have made royalty income up to Rs.50,000/- per month, exempt from withholding tax.

* The Rehabilitation of Buddhist Temples and other religious places of worship is underway, under the “Gamperaliya” Scheme and for the year 2019, we have increased the allocation to Rs.1Mn from Rs.500,000/- per place of worship.

* Solar Power will also be provided under “Gamperaliya” for places of worship to further mitigate their energy costs and relieve the burden on our national electricity grid.

* The infrastructure facilities at the Madhu Church will also be improved.Rs.200Mn has been provided for this purpose.

* The renovation work at the John De Silva Theatre will be completed by 2020, with the installation of ‘State of the Art’ equipment.

* The National Art Gallery will be modernized and a new wing for Modern Art will be established.

* Work on the world-class Performance Centre in Moratuwa will commence in 2019.


Reconciliation Through Economic Empowerment

* Allocation of Rs.200Mn will be made to the Secretariat for Coordinating Reconciliation Mechanisms (SCRM), which comes under the Hon Prime Minister’s Office, for Communication and Awareness programs in this regard.

* The Office for Reparations Bill was passed by this House and work will begin in 2019. We will provide the required resources for the office to be set and staffed adequately.

* The Office of the Missing Persons will be adequately resourced to support families of all missing persons island-wide, including the MIA’s of the Armed forces and the Police, who have obtained Certificates of Absence. They will be provided Rs.6,000/-per month, until the Office of Reparation is established and their cases are resolved. These families will also be given preferential access to relevant “Enterprise Sri Lanka” Loan Schemes and will be required to join the livelihood programs coordinated by (ONUR).

* To fast track development in the North and the East, the “Palmyrah Fund” will be established, with an investment of Rs.5,000 Mn spread over 2 years. We invite well-wishers, philanthropists, especially in the Diaspora, to also contribute to this Fund, which will be administered by the Treasury. The funds will be routed through the Government Agents for development activities in the war affected areas. In addition to these development activities, the fund will also channel resources towards programs that addresses alcoholism, drug abuse, youth unemployment, civil society-initiated counseling and support programs.

* The Debt Relief Scheme will be continued through the Cooperative Rural Banks and Thrift and Credit Cooperative Societies.

* An Integrated Project to create Industrial Scale production of Toddy Bottling and production of Jaggery will be set up in the Northern Province, in collaboration with relevant Co-operative Societies.

* To facilitate more efficient trade links between farmers and the market, 10 Satellite Economic Centres connected to a Central Economic Centre will be established in the Northern Province.

* The Giant Tank will be rehabilitated, facilitating Agriculture, especially in Mannar.

* Rs.2,000 Mn. has been allocated to provide facilities such as Water, Electricity, etc., for the already built houses and to support for partlybuilt or destroyed houses in the North and the East.

* We have provided debt relief to around 45,000 women who are residents of the drought affected districts of Trincomalee, Ampara, Batticaloa, Jaffna,Mulaitivu, Kilinochchi, Vauvuniya, Mannar, Kurunegala, Puttalam, Anuradhapura and Polonnaruwa, who have availed themselves of micro-finance loans, upto a maximum of Rs.100,000 (initial capital) and outstanding for at least 3 consecutive months, since June 2018. This initial step will be followed up with concessionary loans from the “Enterprise Sri Lanka” program and the Cooperative movement, in order that this situation is mitigated in the future.

* Our efforts to ensure reconciliation and provide a sustainable livelihood in the Northern Province, will be further strengthened through the work undertaken by ONUR, including “Sahodara Pasal”, “Heal the Past – Build the Future”, “Viruliya Shakthi”a Programme for Military Widows, Programmes for Peace through Arts& Culture and the
Integrated Village Development Program. ONUR will be further supported to carry out and enhance these programs and design and implement new ones.


Revenue

* Sri Lanka’s tax-to–GDP ratio fell to one of the lowest in the world and the nation’s tax efficiency ratio is also below that of peer countries. In this context, I propose the following revenue proposals to enhance the fiscal revenue in the year 2019, and also to address certain anomalies in the taxation system.

* Revision of Excise duty on Cigarettes effective from 6th March 2019 and introduction of Nation Building Tax on manufacturer of Cigarettes effective from 1st June 2019. Accordingly, Excise duty on Cigarettes, which are more than 60 mm, will be increased by 12%, resulting in an increase of Rs.5 per stick on average. Excise duty on cigarettes will now be based on indexation with a minimum annual duty increase capturing annual inflation and GDP growth. This will ensure revenue protection and control affordability.

* Revision of Excise duty and implementation of luxury tax on motor vehicles effective from 6th March 2019. The revision of the excise duty will have a minimal impact on smaller personal vehicles. In addition, the 200% cash margin requirements on motor vehicle imports will be removed in the near future.

* Revision of Cess duty on importation of Tendu Leaves (Beedie Leaves) from Rs. 2,500 to Rs. 3,500 per Kg, effective from 6th March 2019.

* Revision of Embarkation Fee by USD 10 per person. This increased embarkation fee shall be credited to the Consolidated Fund effective from 1st April 2019.

* Introduction of 3.5% of Nation Building Tax in place of existing Stamp duty, on all foreign payments made by using any Credit Cards and Debit Cards. This will be made effective from 1 st June 2019. This proposal will also help address taxation of off-shore digital services.

* Revision of fee on alteration of passports and issuance of passports effective from 1st April 2019.
1. Alteration of Passport Rs. 500 Per Passport Rs.1,000 Per Passport
2. One Day Service Rs,10,000 Per Passport Rs.15,000 Per Passport
3. Normal Service Rs. 3,000 Per Passport Rs. 3,500 Per Passport

* Revision of the price of special number plates for motor vehicles, issued by the Department of Motor Traffic, effective from 1st June 2019.

No. Type of Number Plate Existing Fee / Unit Proposed Fee / Unit
1 Special Number Plate
Category 1 Rs.50,000 Rs.70,000
Category 2 Rs.60,000 Rs.90,000
Category 3 Rs.70,000 Rs.100,000
Personalized Plate with Name N/A Rs.1,000,000

* Revision of Excise duty on liquor manufactured locally will be based on indexation, effective from 6th March 2019, where the minimum annual duty increase is according to an index capturing annual inflation and GDP growth.
No Type of Alcohol Existing Duty Proposed Duty
1. Special Arrack Rs.3,300 / Ltr No Change
2. Other Arrack Rs.3,300 / Ltr Rs.3,550 / Ltr
3. Country made Foreign

Liquor
Rs.3,300 / Ltr Rs. 3.550 / Ltr
Beer less than 5% Rs.2,400 / Ltr Rs.2,700 / Ltr
Beer more than 5% Rs.2,400 / Ltr Rs. 2,700 / Ltr
Local Wine Rs. 100 / Bulk Ltr Rs.600 / Absolute Ltr

* Peice based VAT rate on disposal of garments by BOI approved enterprises will be revised from Rs. 75 to Rs. 100 on the basis of inflation indexation, effective from 1st June 2019.

* 15% increase of all fees and charges which have not been revised since 2016.

* Increase of toll on expressways by Rs.100 during peak hours effective from 1st April 2019.

* Increase of license fee of casino’s from Rs. 200 mn to Rs. 400 mn per annum and rudjino games to Rs. 1,000,000 per annum. The casino turnover levy will be charged at 15%. These new charges will be effective from 1st April 2019

* A casino entrance fee of USD 50 per person, will be charged, effective from 1st June 2019.

* Revision of economic service charge (ESC) on selected imported goods.

* Revision of unit rate based custom import duty on selected goods including fruit drink, liqour and tobacco effective from 6th of March 2019.

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