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Government says only 2.6% of Sri Lanka’s total workforce subject to PAYE tax
The government insisted that only 2.6 percent of Sri Lanka’s total workforce of 4.64 million are subjected to the pay-as-you-earn (PAYE) income tax, with nearly half of the labour force receiving a less than Rs.30,000 monthly salary.
“The country’s workforce consists of 4,645,572 people. Forty-eight percent of the labour force or 2,231,620 people receive a less than Rs.30,000 salary monthly. Only 120,965 persons or 2.6 percent of the labour force, who are earning over Rs.100,000 per month, are subjected to the PAYE tax,” Finance State Minister Ranjith Siyabalapitiya told Parliament yesterday.
With the state expenditure for the year estimated at Rs.5.42 trillion, he stressed that there is no alternative other than the ongoing taxation measures targeted at enhancing state revenue to Rs.3.65 trillion for the year, which is critical to pay for the essential recurrent expenditures.
“In January, the gap between revenue and expenditure was at 350 percent. Despite these circumstances, we cannot print money, we cannot borrow from abroad and we have reached the borrowing limit from domestic banks,” Siyabalapitiya added.
Currently, monetary financing has been restricted to service interest payments to creditors, as the country is under debt restructuring negotiations with its external creditors and the International Monetary Fund.
Meanwhile, Siyabalapitiya pointed out that 3.91 million families, out of 5.8 million families, are seeking state assistance to continue their livelihoods. Therefore, he urged everyone to play their role in this critical period to emerge out of this crisis despite the financial strain.
“At this juncture, we all need to fulfil the responsibilities that befallen us more or less. We need to bear this stress. The time has arrived for us to think responsibly,” he said.
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