Samagi Jana Balawegaya (SJB) today filed a Special Determination petition in Supreme Court challenging the constitutionality of the Surcharge Tax bill, which was placed on the order paper of Parliament on Tuesday (22).

 

Through this petition SJB General Secretary Ranjith Madduma Bandara is seeking a declaration that the bill requires the approval by the people at a Referendum in addition to the 2/3 approval of the Parliament. 

 

The bill titled “Surcharge Tax” was placed on the Order Paper of Parliament on 22nd of February 2022.

 

The petitioner said in terms of clause 2(1) of the Bill any individual, partnership, or company whose taxable income exceeds Rs. 2000 million for the year of assessment commenced on April 1, 2020 have to pay a rate of 25% on the taxable income of such individual, partnership or company for such year of assessment.

 

The petitioner further said according to the Clause 2(3) of the Surcharge Tax Bill, every individual, partnership, company and the subsidiaries and the holding company of every group of company are liable to pay the tax under this Act and should pay the tax in two equal installments on or before, the 31st day of March and 30th day of June of 2022, to the Commissioner-General.

 

Madduma Bandara maintained that if the Section 2(1) of the Inland Revenue Act No. 24 of 2017 and other incidental provisions of the Bill are read together with Sections 3 

and Section 195 of the Inland Revenue Act, a company subject to the Surcharge Tax contemplated under the provisions of the Bill would include, the Employee Provident Fund, the Employee Trust Fund and the Mercantile Service Provident Fund.

 

The petitioner said those contributions by the Employee and the Employer to the Employees Provident Fund and the Employee Trust Fund are mandated through statute and thus held in trust by the State for and on behalf of the employee contributor.

 

The petitioner further stated that the clauses of the Bill would infringe the Sovereignty of the people in terms of Article 3(1) of the Constitution which further states that “Sovereignty includes powers of the government, fundamental rights and the franchise”.

 

The petitioner further said the clauses of the bill are inconsistent with Article 2, Article 3 read together with 

Article 4 of the Constitution.

 

This bill is to be supported by President's Counsel Farman Cassim. (Lakmal Sooriyagoda)