Gemunu threatens strike if President raises VAT for public servants’ salary hike

Colombo, July 9 (Daily Mirror) - The Lanka Private Bus Owners' Association (LPBOA) warned today that if the President decides to raise the current Value Added Tax (VAT) to meet the public servants' salary increase demands, they will resort to trade union action with the participation of all private associations.

Addressing the media, LPBOA President Gemunu Wijerathne said that they will not allow the President to increase VAT (Value Added Tax) to meet salary increase demands. He urged the President to act with integrity and fairness to protect the education of the schoolchildren.

However, the Treasury Secretary announced yesterday the necessity of raising the current VAT from 18% to 20-21% to meet the salary increase demands of striking public servants.

He said that the tax collected from the private sector is used to pay the salaries of state employees, including parliamentarians. The government collects taxes and obtains loans, which has resulted in negative consequences for the people.

He claimed there is a political conspiracy behind the demands for salary increases and other allowances by state employees. Every trade union, he said, is backed by a political agenda, with some politicians and extremists involved.

"All state employees, including principals and teachers, received their salaries for two years during the Covid-19 pandemic, and some government officials received fuel concessions as well. In contrast, private sector employees received half their salaries, and bus owners and employees received nothing," he said.

"For trade union actions, our bus industry gains no benefit. State employees get their salaries even when they strike, but the bus industry gets nothing. Bus owners earn money only if they have passengers to transport," Gemunu Wijerathne added and argued that political agendas are attempting to pull the country back and shape the political environment to their advantage. He claimed that extremist left-wing political parties are trying to gain the Presidency at the expense of children's education.