When Elitist Hierarchies & Systems Fail: A Community Empowerment Model 

By Siri Gamage –JULY 10, 2017

Dr. Siri Gamage

Whether we read newspapers, listen to radio or watch Television, there is no shortage of issues confronting the country as many stakeholders, commentators and politicians express themselves freely their views through such media. This is in quite a contrasting situation when compared to the atmosphere that existed before the present coalition government came into power in 2015. But the issue now is not the lack of freedom to express or comment on social and political issues. The concern now is lack of action on many critical issues that the voting public in 2015 had high hopes and the failure of hierarchies and systems in place to serve those in need. When questioned about this those in authority come up with various excuses including blaming the previous regime or the lack of political will in one of the constituent parties of the government. Listeners get more frustrated with these arguments, explanations and counter arguments when they realise that these are mere talk shows and no action. Some commentators have even characterised the existing governance situation as paralysis.

The model of representative democracy fails where there is a self serving ruling class or an enlarged elite group who do not work toward nation building or work efficiently to address the needs of those at the end of various hierarchies established to serve people, in particular those who are weak and vulnerable. A measure of a compassionate society is how well it’s governance mechanisms take care of these segments. However the story since independence in Sri Lanka shows how the rich gets richer and the poor gets poorer? How the rich and powerful enjoy the fruits of globalisation, free trade, liberalised economies, migration, employment and education opportunities unleashed by the opening of borders (among these beneficiaries are some members of the middle and working classes but their life chances and net wealth may be much less compared to those in the privileged class’s, politics being one major avenue of privileging).

The hierarchies that have been established over centuries to serve the interests of the people have become burdensome and non-liberating entities for the majority of people. One could even characterise them as oppressive, anti democratic, elitist and anti people. Serious critical reflection is necessary about the contemporary relevance of various hierarchies that control life in general. While a command and control system is required for the administration and security of the people, these hierarchies should be there to serve the people of all ranks and statuses. Likewise, religious and social hierarchies need to serve the interests of the masses without distinction instead of serving those who occupy leadership positions. When political and bureaucratic organisations fail to meet the needs of people, in normal times and in emergencies, their value is no more. Unfortunately, the hierarchies, entities and systems that have evolved in the country seem to function to safeguard the powerful rather than the weak. In this context, what is required is fresh thinking about the model of governance suitable for a small country like Sri Lanka to serve the needs and interests of people, particularly those at the bottom end of governance hierarchies rather than a new constitution that entrenches the power and privilege of the ruling elites or class with big government. Smaller and inexpensive government is a necessity if the desire is to continue with representative democracy, which has been diluted by having an executive President.

In this context it is important to reflect on a few issues not necessarily from party political lenses but from a more communitarian perspective. Let’s take the issue of race, ethnicity and religion about which so much has been written in the media recently. Every human being from the richest to the poorest need a sense of belonging and connectivity with other human beings. This is why we call humans as social beings. This is one lesson we learn when we study sociology- science of society. Some find such belonging in their family, community, school networks, ethnic groups, religious community, language community and so on. By doing so they derive strength to carry on with life, meet daily challenges, find likeminded fellows, happiness and more. Such belonging and connectivity are important when one grows older and become frail. So, there is nothing wrong when individuals in a society are seeking to be affiliated with social and cultural entities like the ones mentioned here.

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Police must be punished for acting beyond the law- Sumanthiran

By Roosindu Peris-July 11, 2017 

Tamil National Alliance (TNA) MP, M. A. Sumanthiran said that the police, does not have the right to take the law into their own hands. 

The statement was made while speaking on the issue regarding the 24-year-old who was shot dead by armed police officers, in Manalkadu, Jaffna. 

Sumanthiran stated that although the police have the right to enforce the law, they do not have the right to act above the law. 

He further added that the police had the right to enforce the law by arresting the individual involved in the illegal sand mining case that happened in Jaffna recently, but did not have the right to shoot the person dead. 

Sumanthiran stated that the police officers involved in the shooting must be punished for acting beyond the law. 

Sri Lanka: Shadows of corruption in Good Governance!

The reasons for the President getting perturbed are clear. His time is running out fast, while the opposition is gathering steam and pushing forward faster than anticipated. Yet, the proposed solution, as announced at the media briefing by the government spokesman, is not one the people expected.

by Raja Wickramasinghe-Jul 11, 2017

( July 11, 2017, Colombo, Sri Lanka Guardian) The President has now completed the halfway mark of his term in office and this offers an opportunity to the people, and to the government, to take stock of its achievements and failures of the past thirty months. Democracy, the rule of law, corruption, waste and politicisation of government institutes were prominent among the issues raised at the 2015 January Presidential Election. The main theme of the campaign was punishing those politicians and officials, who thrive on bribes, kickbacks, embezzlement and other forms of grand corruption. The people expected the government to fulfil their expectations as promised. This was the biggest challenge to the government.

Already the calls to account for the deficit between words and deeds have begun in earnest for the government. It may be possible to ignore them for a time, but they all come home to roost over the lifetime of the government. In this context, the President getting perturbed over the performance of some government agencies lagging behind in achieving results can be expected. It was last week that the cabinet of ministers chaired by the President discussed about institutions and agencies the government set up to achieve certain defined objectives, being inefficient and not working towards those set objectives. It was also reported that the President summoned the Directors and principle officials of the Sri Lankan Air Lines and reviewed its performance in the company of some Ministers, and was not satisfied over their achievements.

The reasons for the President getting perturbed are clear. His time is running out fast, while the opposition is gathering steam and pushing forward faster than anticipated. Yet, the proposed solution, as announced at the media briefing by the government spokesman, is not one the people expected. Taking over all the law enforcement agencies under the President, complete investigations within three months and put the related persons behind bars, would never be appreciated and accepted by the people who endeavoured to defeat such action in January 2015.

It is not the stature of the political authority at the helm of these institutions that matters most. These law enforcement agencies need resources, expert advice and assistance, an environment to work with freedom and independence to do their job without interference and fear. They need words of appreciation, encouragement and acknowledgement rather than threatening words to discourage them. They need to be elevated to higher positions in recognition of their good work, rather than drag them out of their job for doing it.

It was often found difficult forensically to pursue the hard trails of corrupt politicians, especially those with high placed friends, and corruption committed with overseas connections. To overcome such situations, the need of a highly trained, specialized corruption investigative and prosecuting staff is needed. They could expedite investigations, having provided all the resources, expertise and assistance of other government agencies to facilitate investigations within the country and also beyond its borders.

The civil society and anti-corruption activists in the country, during the last two and a half years, much before the President took it up last week, continuously criticized the government’s lax enforcement of its anti-corruption laws, delays in concluding investigations into complaints, and bringing the culprits before the law.

They asked the government to set up special courts to exclusively deal with cases of grand corruption involving VVIP politicians and high level public officials. It was justified to set up a special Anti-Corruption Tribunal in the country, to try and provide punishments to corrupt political leaders and those who feed off corrupt practices, and thus minimize the crimes of corruption countrywide. An anti-corruption tribunal with wide powers to try, and punish these politicians and public officials would help to reduce impunity and thus deter grand corruption. Nothing has happened thus far. However, allegations of serious corruption and wastage of people’s tax money, against politicians of the present government in power have started to surface, eroding the confidence the people reposed in the “Yahapalanaya”

An Anti-Corruption Tribunal would focus its energies and time on grand corruption, whether it refer either to past or the present regime or to this or the other party – the large scale theft or conversion of public money to private riches. It would not focus on insidious petty corruption as allegedly the inquiries are now focused on. Such a tribunal would be more concerned to prosecute those who preside over rampant corrupt practices and reward their families, friends and henchmen. This was the people’s expectation.

As for providing protection to criminals, the criminal justice system requires that people accused of crime be afforded certain rights and protections. We need to take these constitutional guarantees very seriously in spite of our personal frustrations, as we believe the criminal justice system is the arbiter of truth.

It is hard. The Bar for a criminal conviction is high. But the fact remains that the protection and rights afforded to the accused limits the prosecutor’s role. Such protection and rights are not afforded to the complainant. Under these circumstances, it is debatable whether this system provides a level playing field to the complainant? Nobody would be surprised in this truth seeking process, if the outcome did not match the truth the people desire, and are quite aware of. Yet, we need to keep our faith stronger in the system of investigation, prosecution and the judicial process. If a criminal is not convicted, that verdict does not mean that he did not commit that crime. What that means is that there was not enough evidence to convict the accused. There are always two trials going on, one in the courts of law, and the one in the court of public opinion. The verdicts can be strikingly different.

Sri Lankan airline, other government owned institutions that provide utilities such as electricity, petroleum, water etc. are mired in politics and empire-building does not appear to have changed much, to the dismay of the people who expected a change.

People are left to pay off ballooning debts with nothing to show for it but politically driven white elephants. In the face of bad planning and stubborn mismanagement the consumers are called upon to pay higher prices. Despite all this the blame game goes on and on, non-stop with the former blaming the present for privatizing and selling country’s assets. The present one is blaming his predecessor for robbing national wealth and enriching themselves and their kith and kin. Oh, God, when will this be stopped and the truth come out. Will that day ever dawn?

These institutions were set up by a more responsible generation of politicians then as a wise investment. After years of political meddling and economically dubious investments since then, attempts are being made as the only way to attract private capital, to hive off the bad debts these institutions currently carry, leaving taxpayers to foot the bill, as proposed in the case of Sri Lankan air line. This is one institution the new government was swift to appoint a committee of investigation to unearth previous management’s financial irregularities and mismanagement, and set in motion an efficient system of management and financial discipline. Alas, the new management is yet to take action on important recommendations of the committee. In the meantime, nothing has changed but the faces, the Sri Lankan Airline continues to burden taxpayers in billions of rupees incurring losses, and continuing unhindered to be mired in politics and empire building.

Editorial: A simmering crisis

Illustration: Keera Ratnam

11 Jul  2017

On Sunday afternoon, Sri Lankan police shot dead a Tamil man in Jaffna. Though the facts around the killing are still not clear, with reports he may have been involved in illegal sand mining, what is known for certain is that Yogarasa Thines was completely unarmed. The police decision to gun him down, not only seems wholly disproportionate, but follows a sadly well-established pattern of Sri Lankan state violence against Tamil civilians, amidst a culture of impunity.

The frustration at the killing of yet another Tamil boiled over the following day, as locals burnt tyres, blocked roads and damaged a police post in demonstrations. Given Sri Lanka’s long history of impunity and the total lack of accountability for the countless Tamils who have been killed by the state, the outrage at another killing is not an unusual response. Tamils feel the state will once again attempt to sweep this act of violence under the carpet, in a flurry of broken promises, endless bureaucracy and hollow investigations, like it has done with so many before it. The Tamil people are, justifiably, angry.  

This killing echoes back to the murder of two Jaffna University students last year, also gunned down by Sri Lankan police in October. Despite widespread protests and arrests being made, that case continues to drag on without an end in sight. Whilst the reported arrest of two police officers on Monday for the killing of Mr Thines is a welcome sign, Colombo cannot stall proceedings there, as it has done on numerous occasions before. A full-scale inquiry into the killing must be swiftly carried out and those responsible prosecuted.

However, the government’s response to the protests – beefing up security presence by deploying the infamous Special Task Force across the region - sends worrying signals. Instead of addressing legitimate Tamil concerns around state violence, it seems as if the state is poised to respond with an increased security clampdown. This is the wrong approach to take. Far from quelling the palpable frustrations across the North-East, it instead heightens fears of a cover-up and increases the militarisation and intimidation of the Tamil homeland.

This is not new to the North-East. Whilst the South too has suffered from the excesses of Sri Lanka’s militarisation, there is an inescapable difference. The sheer extent of the violence, with tens of thousands of Tamils killed or unaccounted for, alongside an unwillingness to seek accountability for those crimes, reveals a stark disparity in both scale and context. All whilst the very same soldiers that Tamils have witnessed commit horrific acts of violence, continue to occupy their homeland in massive numbers. The lack of outrage from the Sinhala press, Southern civil society and the general public towards Tamil deaths – including the killing of Mr Thines – is also telling. Tamils on the island remain unequal, even in death.

It has now been well over two years since this government came in to power. Despite repeated reassurances to the international community of a profound transformation towards ‘good governance’, a lack of tangible action in this case will only add further evidence that impunity still reigns. Sri Lanka must not be allowed to let this continue. If justice is not served, anger and discontent across the North-East will continue to rise, as it has done with many other issues that affect the life of Tamils over the past two years. As has been demonstrated several times over the island’s bloody history, brute force will not quash Tamil voices for justice. Indeed, despite unfathomable losses, the Tamil voice has only grown louder.

It was a history of violence, insecurity and disenfranchisement that fuelled the decades long ethnic conflict. That reality has not changed. The state’s actions in the days to come will make amply clear whether it intends on defusing or exacerbating the simmering crisis on the island.

The advent of rape pornography in sri Lanka

BY FAIZER SHAHEID-2017-07-12

The gruesome rape and murder of Vithya Sivaloganathan in 2015 is hardly discussed anymore, even among the activists who laboured and campaigned vigorously to have the perpetrators arrested, at least, not outside of the North where the entire ordeal took place. However, the case filed in the Jaffna High Court has progressed steadily, and as if the details of the rape and murder were not already disturbing enough, investigations have unearthed information far more disturbing than originally anticipated.

The advent of rape pornography in sri Lanka.docx by Thavam Ratna on Scribd

Chief Minister Wigneswaran Worships Serial Rapist & Murderer Premananda

By Veluppillai Thangavelu –JULY 11, 2017

Veluppillai Thangavelu

There is a proverb in English language “Show me your friends and I’ll tell you who you are…”  It  means  find wise people and be in their company as much as possible. Very few know the dark side of Chief Minister C. V. Wigneswaran‘s life or they know but pretend ignorance. In a recent interview M.A. Sumanthiran alluded that Wigneswaran is a devotee of Premananda who was convicted of raping under-aged orphan girls living in his Ashram and murder of a young engineer Ravi. All the victims of Premananda’s sexual exploits were young girls from Jaffna who followed Premananda when he emigrated to Tamil Nadu following the 1983 communal riots.  

Premananda was born on November 17, 1951 at Mandandawela in Matala. His real name is Premkumar Somasunderam but later took the name Premananda meaning one possessed with love and eternal bliss. Premananda’s father Somasunderam is from Thanjavur in Tamil Nadu. He married Pushpakanthi. Premkumar (his original name)  attended Christ Church College in Matala until 8th standard. The house he was born is still there after undergoing renovation.  

His biography reveals that as a young schoolboy Premkumar could manifest sweets or fruits out of nowhere for his friends, and he became renowned in his school for multiplying his lunch food, for holding erudite discussions on philosophical subjects and even for performing miraculous healings. Knowing that he could immediately see anyone’s problems and infallibly predict their future, the parents of his friends became the boy’s first devotees before he reached adolescence. As news of his powers spread, hundreds of people in  cities and villages began to seek his blessings and healings.  

At the age of 16, after Premkumar used to conduct prayers, ceremonies and interviews in his grandmother’s house. As time passed an Ashram was built to welcome the crowds of people who flocked to see him. Named the ‘Centre of Peace for All Religions’ with symbols of every major faith painted on inside walls.  

In 1969 while he was addressing some 200 devotees who had gathered to listen, his body began to glow and a saffron coloured robe suddenly seemed to descend on him. A saffron coloured garb is that of an initiated Hindu monk. At the time he was only 18 years old but from then onwards he became known as Swami Premananda. He often materialised holy ash or vibhuti from thin air. It was claimed that even as a toddler he exhibited an unusual interest in spirituality. While his brothers and sisters played outside, Premananda could be found performing poojas (rituals) with his grandmother, or facing a wall in a corner absorbed in deep meditation. It is said that if he thought too much about the divine or the lives of saints, he would fall into an unconscious state of rapture. 

In 1983 Premananda’s  modest Ashram was destroyed during 1983 communal pogrom, so he emigrated to Tamil Nadu with some orphan children and settled down in Thiruchi. Soon his name became famous, next only to another god man Sai Bava, for materialising objects like lingam, rings, chains and even watches made in Japan. He bought 150 acres of land at Viralimalai in Pudukkoddai and set up an Ashram and an orphanage. The Ashram was officially opened in 1989 and  about 100 boys and girls lived in the Ashram, most of  them orphaned during 1983 riots. In the Ashram all the children are provided with food, clothing, and shelter, schooling and medical attention free of charge. Premananda’s Ashram flourished and he set up Premananda Centres and Premananda Youth Groups in many countries, including UK, Switzerland, Belgium. The aim of the Ashram, Centres and Groups is to offer spiritual guidance and help to all who come and to offer service to those in need throughout the world. It is claimed Premananda’s teachings are universal and transcend the barriers of race and religion. 

Many politicians and several foreigners became his devotees. They were mesmerised by his production of vibhuti (sacred ash) by sleight of hand. He wore saffron clothes and had a kinky hairdo. When the girls reached puberty, he raped them, hoodwinking them into believing that he had divine powers. Educated fools mistook him as a god incarnation and became his followers. One of them is ex Supreme Court justice and current Chief Minister of Northern Provincial Council Wigneswaran who considers him as his Supreme Guru.  

Normally god men look intensely charismatic and attract followers, especially women in their thousands. But,  the stoutly built,  dark-skinned  and bearded Premananda possessed no such charisma, but the magical powers he claimed attracted both the educated and uneducated. They were mesmerised by his production of vibhuti (sacred ash) by sleight of hand. He wore saffron clothes and had a kinky hairdo. When the girls reached puberty, he raped them.  

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GMOA doctor terrorists voluntarily inviting trouble learn a lesson of their lifetime ! (video)

(Lanka-e-News - 11.July.2017, 6.10PM) The GMOA terror mafia  of Dr. monster Padeniya which has become a scourge of the country learnt a lesson of its life time yesterday  (10) . That was , following  an  attempt made by Dr. joker Padeniya using  the label of Professor  Carlo Fonseka  to stage indefinite strikes to the detriment of the poor suffering patients.  The GMOA leaders were  openly disgraced  by the professor personally  before the media cameras.

This dastardly attempt was made by the GMOA while the minister of health  was making preparations to appoint  Professor Colvin Gunaratne as the president of the Sri Lanka Medical Council following the completion of the  term of Dr. Carlo Fonseka  which ended on 2017-06-30 . In fact , Dr. Carlo Fonseka  held office a second term  after his  first  term of appointment was extended .

The GMOA now dubbed ‘Government Medical oppressors  association’,  the name which best suits it  based on its  terrorizing activities totally uncaring for the patients , the noble profession and the country at large sought to advance a most stupid argument in keeping with its lop sided policies and insanity fits . The GMOA’s abominable  and atrocious motive was  to pay off its inveterate grudge against the health minister who on the contrary  is considered by one and all as fully committed to improve the health services of the country on an unprecedented scale despite the sabotage activities of heartless criminal  Padeniyas alias  doctor jokers. 

Their foolish  argument was : the extension of  the services of Dr. Carlo Fonseka for six months following the end of his first term lasting five years is unlawful,  as legal provisions permit  only  to extend the term by another 5 years and not 6 months. 

It is unfortunate the GMOA which has lately contracted AIDS (Acquired Intelligence Deficiency syndrome ) , via this argument demonstrated only the intelligence deficiency of its leader  Dr. joker Padeniya and his group of  mentally sick moronic medics.  

Nowhere in the world a  term of office after the first appointment is extended to last the same period as the first. Extension of  a term is subject to  a specified time frame.  It is only the GMOA moronic doctors  of Sri Lanka who are  afflicted with AIDS-  Acquired Intelligence  Deficiency Syndrome are   ignorant of this fact . 

The GMOA of Padeniyas which is working according to the time table and  outdated sabotage theories of discarded and disdained ex president Medamulana threatened  on the 9 th ,   if Carlo is not re appointed they would stage an indefinite strike – the favorite occupation now  of these mentally sick AIDS contracted medical practitioners who prefer idling and street loafing carrying placards to honorably and honestly discharging their medical duties  for which they get  paid by the government .
 
However when these doctor jokers of the GMOA met Dr. Carlo Fonseka on the 10 th (morning ) at his home they  were greeted by a reply that shocked and shamed them on an unprecedented scale. Fonseka  begged and said , not to stage strikes using him as an excuse. 

 ‘ I think you are committing a small foolish mistake . When I am one  having one foot in the grave , your action to stage strikes to extend my term of office is most reprehensible and abhorrent.  Hence son , I beg you  not to  indulge in that wicked strike. Please allow me to die happily. On the other hand if you do strike , that will be the day the ties between you and I will come to an end. ‘ This was the golden advice and dire warning given by Dr. Carlo Fonseka to doctor joker self centered self seeking Padeniya directly to his  face and his terrorist medics,  before the cameras.  Later Dr. Carlo Fonseka addressing the media revealed, if the (terror) doctors including Padeniya are still going on strike it is better they slit his throat first before engaging in that.

The GMOA and its terror doctors who have now become a worse  menace to the country than the drug dealers and addicts because of their strike addiction (AIDS)  had to go back dumbfounded and crestfallen. Dr. Carlo’s advice cum warning made them sadder but wiser perhaps. 

The GMOA which was exploiting the anti SAITM issue to stage strikes according to their own  whims and fancies thereby driving the poor helpless patients into abysmal suffering are now  thoroughly disappointed and defeated.  This is mainly because after the appeal court delivered a verdict that the medical degree of SAITM students  shall be accepted , and after  the Supreme court (SC) issued an order that the GMOA shall be made a party to the case filed following an appeal made to the SC by the Medical council against the appeal court verdict.

When the GMOA is a party to the litigation , it must necessarily wait until a judgment is delivered  by court . In those circumstances  the GMOA cannot stage strikes (even if it is suffering from incurable acquired intelligence deficiency strike syndrome) demanding that the SAITM shall be acquired by the government or citing such other flimsy excuses. At all  events the GMOA is now bound to abide by the pending SC decision whether it likes it or not. 

The Padeniyas who were hard pressed to meet the time schedules set by the Medamulanas , by trying to do their best to stage a strike making use of Carlo Fonseka , only ended up demonstrating  to the world their moronic traits , terrorist propensities and traitorous motives . No wonder this doctor mafia has become the butt of everyone’s jokes, and its leaders a laughing stock having lost all the prestige and dignity the medical practitioners enjoyed  in the past .

If anybody  is to wage a struggle on another’s behalf it is a natural requirement that he/she informs the other or gets his /her consent before the struggle is launched, and the people are only later notified.  Whereas these GMOA leaders , the two legged buffaloes have met Prof. Carlo Fonseka only after holding a media briefing and publicizing that they are striking on behalf of Carlo Fonseka . That is, being two legged buffaloes they have put the cart before the bulls ,  the only thing these two legged buffaloes  know to  do. They met Dr. Fonseka only the following day , and  met their Waterloo  too.

Dr. Fonseka not only rebuffed them and treated with absolute contempt , he even warned if they strike on his behalf they should do it only after cutting his throat (perhaps Dr. Carlo knew that GMOA was best at throat slitting!  )  . After facing the humiliation , the shameless GMOA went away with their media cameras not before describing Carlo Fonseka as a ‘nakiya’.

May we pray and ask even the worst enemy should not suffer such egregious disgrace , defeat and humiliation !
 
Right now , all what we can pray and hope for is , at least now the doctors who had appointed these two legged buffaloes as their association leaders would  open their eyes .

Relevant video is hereunder 

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by     (2017-07-11 12:42:21)

Demystifying the Inland Revenue Bill 2017

Tuesday, 11 July 2017

In his presentation the Budget Speech for 2016, the Minister of Finance proposed to introduce a New Income Tax Law on the following lines: “Existing tax laws in the country are cumbersome, complex and based on traditional British concepts. The complexity of the tax laws has been identified as an impediment for the effective implementation of tax policy in Sri Lanka. It has led to various complications thereby hampering the effective implementation of the tax policy. Therefore, we need to redraft the tax laws to bring about necessary improvements to the legal framework to ensure clarity, consistency and simplicity towards reflecting the features of modern tax systems which will help taxpayers to understand the system easily and eliminate loopholes that have been created by the ambiguities in laws while strengthening tax administration. For this purpose, we will receive technical assistance from IMF and I propose to complete the project/process by end 2016.”

In keeping in line with the pronouncement, the proposed Inland Revenue Act (“new Bill”) has been published by gazette dated 16 June and was issued on 19 June. According to the new Bill the effective date of the proposed Inland Revenue Act is expected to be for any year of assessment commencing 1 April and will thereby have the effect of repealing the Inland Revenue Act No. 10 of 2006 (as amended). However, as per the Section 203 (2) of the new Bill, the current law (i.e. the Inland Revenue Act No. 10 of 2006 (as amended)) will continue to apply in respect of events occurring prior to the date of commencement of this new Inland Revenue Act.

Upon analysis of the past two decades of Sri Lanka with regard to Income Tax laws, the proposed Act will be the third Inland Revenue Act since the year 2000. However, the new Bill is structurally different to the laws we have been conversant with historically. For instance, the terminology is different and the new law deviates from the previous taxability provisions. The concept of statutory income has been removed.

What does the new 

Bill entail?

At a high level, it is clear that the income tax exemptions are limited and the tax rates are streamlined. The key changes as enlisted below.

Individuals and non-corporates

• The present 10 sources of income have been regrouped under four sources, namely, employment income, business income, investment income and other income.
• Capital gains tax has been introduced at 10% (with certain exemptions)
• The progressive tax slabs for individuals has been revised as depicted in figure 1.
• The tax free allowance of Rs. 500,000will remain the same for all citizens and residents of Sri Lanka.
• The present maximum of 16% tax rate on employment income has removed and employed individuals will fall in line with the standard progressive tax slabs as per figure 1. However, qualifying payment relief on employment income of an individual who is tax resident in Sri Lanka has been increased from Rs. 250,000to Rs. 700,000. However, the exhaustive list of exemptions that were afforded on profits from employment have been removed. As such, employed individuals can draw a salary of Rs. 100,000 per month tax free.
• The Bill is silent on the 10% discount for early settlement of self-assessment payments, therefore it is presumed that this is removed.
• The withholding tax rate on interest of 2.5% on bank deposits for resident individuals has been increased to 5%.
• The qualifying payment was previously extended to non-citizen non- resident employees as well but the concession does not apply to this class of individuals as per the new Bill.
• The exemption of interest income of senior citizens has now been classed as a qualifying payment subject to a ceiling of Rs. 1.5 million.
• The 10% rate for non- corporate entities such as charitable institutions,employee trust funds, provident or pension funds and termination funds has been increased to 14%.
• The present 8% partnership tax has been removed.
• Scope of the withholding tax has been expanded. Accordingly, rent, interest on loan and partner’s share of any partnership income would be liable to withholding tax.

Companies

• The basis of computation of tax has been changed with the reclassification of the sources of income and taxation of capital gains.
• Capital allowance rates and mechanism of computation has been revised.
• The current law provides for an indefinite carry forward of tax losses, the new Bill restricts the carry forward period of unutilised tax losses to six years. Furthermore, losses are deductible only against business profits from the same activity/rate.
• n The withholding tax on dividends and interest has been increased from 10% to 14%.
• n The concept of notional tax credit on Interest on government securities in the secondary market is removed.
• n Exemption granted to specific institutions have been removed.
• n Withholding tax on service payments have been introduced at the rate of 5% and 14% subject to certain conditions.
• n Tax rates have been revised under three tiers structure as, lower rate of 14%, standard rate of 28% and higher rate of 40%. The sector wise corporate tax rates are depicted in figure 2.
• n Resident companies are not entitled to claim withholding tax on interest as tax credit and interest net of withholding tax to be subject to tax.
• n No tax exemptions have been proposed via the New Bill but the concessions for various developments can be obtained via enhance depreciation allowances.
• n The concept of Deemed dividend tax has been removed whereas the scope of dividend has been widened to capture capitalisation of profits.
• n The present threshold to Small and Medium Enterprise (SME) of Rs. 750 million has been reduced to Rs. 500 million.
• n In order to ascertain the business income of a non-resident, the “Permanent establishment” concept has been introduced in the Bill.
• n Transfer Pricing rules have been modified drastically with the introduction of a Dispute Resolution panel, revised rules and an extensive penalty regime for various degrees of non-compliance.

Administration

• The present time bar period for raising assessments of 18 months has been extended to four years (other than in the case of default assessments). This causes greater degree of uncertainty of application of tax rules by a taxpayer since the return filed for a particular year of assessment remains open for assessment for a far longer timeframe.
• The appellate procedure has been revised.
• The advanced ruling mechanism has been modified and the concept of “public rulings” and “private rulings” have been introduced. A fee mechanism to be introduced for application of private rulings. The turnaround timeframe is set at 90 days within the date of request.

A key observation is the term “solely” in the context of invoking the 14% concessionary rate, the wording of the law is that it is granted for instance “in the case of a company solely conducting a business of exporting goods and services” and so on. This is a very restrictive concession as the term “solely” appears in all instances where the 14% rate has been afforded (except for SMEs). This will be very challenging to the tax payers when there is any other business income along with the specified business activity. Since sectors such as export, agriculture, educational, promotion of tourism and information technology are key drivers to the economic growth, the policymakers should accommodate some flexibility in order to encourage and develop them.

While the new Bill keeps in line with the policy pronouncement and these changes are done to simplify the tax framework, broadbase the tax network and ease collection in a bid to generate more tax revenue for the growth and betterment of the country. It is worrying that the effective date of this Act is proposed to be 1 April 2017. The Inland Revenue Department in April, issued a notice to taxpayers to continue with the present law until further notice. We are already a quarter into the year of assessment 2017/2018 most of the taxpayers comply with their monthly statutory tax payments such as PAYE and WHT under the Inland Revenue Act No. 10 of 2006. As such, introducing the proposed Act with retrospective effect should not leave room to penalise them such taxpayers subsequently and it must be clarified by the Department of Inland Revenue. In the alternative, the effective date should be a future date allowing taxpayers to work with certainty of tax policies. Also, it would be meritorious if that the Minister of Finance reintroduces the office of Tax Ombudsman as proposed in the budget for the year 2017 as this will enhance the taxpayer’s confidence in exercise of their rights.

(The writer is Director – Tax Services, BDO Partners.)

CABINET SHUTS DOWN THE ‘FRAUD’ COMMITTEE

By Denagama Dammika Ranaweera-2017-07-12

The Cabinet of Ministers yesterday decided to close down the Anti-Corruption Committee Secretariat. At the meeting, Prime Minister Ranil Wickremesinghe presented to the Cabinet a summary of the activities carried out to date by the Anti-Corruption Committee Secretariat that was set up after the Presidential Election in January 2015 on a recommendation to the Cabinet by Prime Minister Ranil Wickremesinghe himself.
It was intended to be a high-powered committee that met weekly to review progress in anti-corruption probes.

Yesterday's decision comes in the wake of harsh criticism by President Maithripala Sirisena of the Anti-Corruption Committee Secretariat at last week's Cabinet meeting. Cabinet Spokesman Minister Rajitha Senaratne then told journalists that the Cabinet will discuss the matter further at yesterday's Cabinet meeting.

He added that the Secretariat was only investigating minor fraud allegations and that very many SLFP MPs feel that it is deliberately targeting its members over trivial matters. "Although the monthly expenditure for the upkeep of the Anti-Corruption Committee Secretariat is Rs 12 million, it only has six investigators and one consultant investigator but has five directors and five consultants.
We promised the people that we will punish financial criminals but we have done nothing. People are losing faith," he said.

Sri Lanka: Kiriella’s High-speed Corruption

( July 12, 2017, Colombo, Sri Lanka Guardian) Subject minister Lakshman Kiriellla has allegedly given consultant postings in the highways ministry to four family members of his media secretary Rajitha Samarasuriya, reports say.

The appointees are Rajitha himself, his father Cyril, brother Savinda and sister Athma Madhuwanthi Peiris.

They have all given no. 106, Aruppolawatte, Kandy as their home address.

Each is a paid a monthly allowance of Rs. 65,000.

Meanwhile, ‘Lanka’ newspaper reports Kiriella’s daughter secures all contracts of the highways ministry through a company owned by her.

Chami, also his private secretary, owns Kandy Construction Ltd., which obtains the contracts and distributes them to subcontractors.

Massive losses from lottery printing

Jul 10, 2017

Just like during the previous administrations, the focus in the present ‘Yahapaalana’ government too, is on the Finance Ministry. It attracts attention of all and receives both criticisms and commendations. As a crucial factor in the country’s future, the responsibilities and the accountability it carries are no simple tasks. On the other hand, from the annual budget, the criticisms it undergoes cannot be ignored lightly. The matter worsened following the bond issue.

Even today, the Lotteries Board remains a controversial matter. However, former minister Ravi Karunanayake told the media recently that under him, the Board had earned a Rs. 300 billion profit. According to him, that profit was made due to the attacks unleashed on the hidden political hands in the Board. The portfolios have changed, but the Board remains under him.

We have received reports about questionable situations with regard to the printing of lotteries. From 2002 to May 2016, the lotteries were printed by MBA Pvt. Ltd. When comparing the rates it had submitted previously and the new rates, the losses to the Board are enormous. Under the new procurement mechanism, the annual saving in 2016 in the printing of Jathika Sampatha, Vasana Sampatha, Govisetha, Supiri Vasana Sampatha and Supiri Delakshapathi alone was Rs. 57,283,185.20. Simply put, Rs. 570 million.

MBA has been printing since 2002 and due to the political powers it enjoyed, the tender procedure was not applicable for them. Until May 2016, it had been able to have its own say. The Board has lost Rs. 636,425,053.46 due to the lotteries having been printed at high rates. That shows the strength of the political hand that had been appearing on behalf of MBA. But, remember, what has been swindled is public money.

If any party wants to make a clarification or explanation in this regard, we are ready to accommodate it.

Captain Tissa Wimalasena further remanded

Tamils Abducted In Colombo Ended Up At Trinco Navy Camp: CID Tells Courts

Lakmal Sooriyagoda-Wednesday, July 12, 2017

Two suspects including Captain Tissa Wimalasena, the driver and security officer of former President Mahinda Rajapaksa, were yesterday ordered to be further remanded until July 18 by the Colombo Chief Magistrate’s Court for allegedly operating an illegal quarry on a government-owned land in the Koratota area causing a loss of Rs. 29 million to the government.

Two suspects Tissa Wimalasena and Lal Priyantha Peiris, a former member of Puttalam Pradeshiya Sabha, were arrested by the FCID under the provisions of the Public Property Act and the Prevention of Money Laundering Act.

The suspects were charged with having operated a rock quarry, situated at the Land Reclamation Commission, claiming that it belonged to the Maga Neguma project.

When the case came up before Additional Magistrate Chanima Wijebandara, the Additional Magistrate refused to grant bail on the suspects citing that there are no exceptional circumstances to release them on bail.

Meanwhile, the second suspect yesterday informed Court that he is ready to make a special statement before the Magistrate regarding the incident.

The Additional Magistrate is to consider this request on the next hearing date.

Palestine campaigners removed from “terror” database

World-Check forced to concede Hugh Lanning “should never have been included” on “terrorism” database. (PSC)

Asa Winstanley-11 July 2017

After legal action, the Palestine Solidarity Campaign has been removed from a powerful and secretive global banking database on “terrorism” and other crime.

Database entries for PSC and its chair Hugh Lanning were removed after the group’s lawyers put pressure on World-Check, PSC said in a statement last month.

World-Check conceded they “should never have been included on the ‘terrorism’ database, and profiles have been removed on this basis,” PSC said.

But an investigation by The Electronic Intifada has found that dozens more Palestine solidarity groups in the UK alone may have been affected. Many have had bank accounts closed over the last few years.

Ravi Naik, one of PSC’s lawyers said, “Following correspondence between our firm and lawyers for World-Check, it has been accepted by World-Check that our clients should never have been on the database at all, let alone for an unfounded allegation as egregious as terrorism.”

The statement explained that “PSC, Hugh Lanning and World-Check have reached an agreement to address the harm done” to PSC and Lanning’s reputations and to “resolve the matters between them arising from that profile.”

There were no details revealed of any financial settlement.

False allegations

Lanning said he was pleased with the agreement and hoped “the Israeli government and their supporters follow this good example and stop repeating unfounded smears about the PSC and its members.”

PSC will “not stand for false allegations made about us and our work,” the group’s director Ben Jamal said. “Campaigns for Palestinian human rights should not be treated differently.”

In February, North London’s Finsbury Park Mosque won an apology from World-Check in the High Court.

The mosque secured damages from the firm after its bank accounts were closed by HSBC in 2014.
World-Check is a global database run by Thomson-Reuters, the company that also owns the Reuters news agency and provides a host of financial and “intelligence” services to corporations and governments.

The firm says World-Check is used by 49 of the world’s 50 top banks to vet prospective customers for suspected financial or other criminal wrongdoing.

But investigative journalists have found that the firm’s information is often sloppy at best and defamatory at worst.

Over the last couple of years, PSC and other Palestine solidarity groups around the world have been forced to move banks, after firms like HSBC and Co-operative closed their accounts with no real explanation.

Right-wing sources

In November 2015, PSC launched a legal case against the Co-operative Bank for closing its account. The bank had refused to explain, citing only their lack of “risk appetite.”

In February 2016, a Vice News investigation revealed that PSC had been listed on the World-Check database under its “terrorism” category.

PSC responded that “World-Check’s sources appear to be right-wing websites and blogs,” including the Investigative Project on Terrorism.

That group was founded by Steven Emerson, one of the world’s leading players in the lucrative Islamophobia industry.

In 2015, Emerson was called a “complete idiot” by the UK’s then prime minister for falsely telling Fox News that the English city of Birmingham was a “no-go zone” for non-Muslims.

In October last year the Bank of Ireland closed the Ireland Palestine Solidarity Campaign’s account, again citing only “risk appetite.”

Opaque

An investigation by The Electronic Intifada last year found that at least 30 Palestine solidarity groups in the UK had had bank accounts closed, usually for for vague “risk appetite” reasons.

But due to World-Check’s totally opaque operations, it was not possible to independently confirm that the database had been behind the closures.

World-Check’s terms and conditions stipulate that its users are banned from disclosing anything in the database to anyone else – even to those actually listed in it.

Thomson-Reuters told journalist Peter Oborne that “we don’t allow media access” to the database.

When in August 2015 the treasurer of Palestine solidarity group ISM London asked why the Co-operative Bank was shutting down its account, she was told, “I’m not at liberty to discuss that information with you, because it’s confidential” – even to the holder of the account.

Jacinta Kent told The Electronic Intifada last year that the bank said, “we are not obliged to disclose the criteria we use when assessing our risk policies” but “I can assure you our decision is not based on the conduct of your account.”

Tip of the iceberg?

Several Palestine groups with closed accounts contacted by The Electronic Intifada for comment last year declined to speak on the record for fear of further spreading the defamations that had apparently prompted the closure of their accounts.

All this is likely to be the “tip of the iceberg” according to Tom Keatinge, a former banker and director of the Centre for Financial Crime at the Royal United Services Institute, a British think tank.

He told The Electronic Intifada that “victims have [often] not made a public noise about it.” They felt that “shouting about it was probably not going to help them get a new bank account somewhere else.”
According to Keatinge, removal from World-Check may not mean the end of problems.


“Once you’re in World-Check, even if World-Check takes you out, I think you’re in trouble,” he said. “There’s no real right to be forgotten,” he explained, “the bank still remembers you.”