Current tax appealing process allows any person to evade paying taxes for 15 years

37 billion rupees collected as tax arrears this year

By Ajith Siriwardana   

The government was considering establishing a special court complex within the judicial system to hear tax appeals in the backdrop that the appealing process allows any person to stay without paying taxes for 15 years.   

The Minister of Justice Wijeyadasa Rajapakshe has agreed in this regard during a special meeting held in the Parliament to obtain ideas for the legal amendments to be made in order to increase the state revenue. 

Chair of the Sectoral Oversight Committee on National Economic and Physical Plans Mahindananda Aluthgamage said any person can stay for 15 years without paying taxes.   
“The Inland Revenue Department has 30 months under the existing Act to assess a tax file and another 24 months to consider appeals. Accordingly, a tax file remains in the Inland Revenue Department for more than 54 months and post appealing to the Tax Appeals Commission, they receive 2 years according to the Act,” he said adding that thereafter, appeals can be made to the Court of Appeal and the Supreme Court which will last for approximately 15 years.   

The Committee observed that the current period of two (02) years for the Commissioner to hear appeals is too long and it is desirable to reduce it to six (06) months.   

Meanwhile, the officials of the Inland Revenue Department said that the arrears in tax revenue due on 30.06.2023 is 943 billion rupees, and Rs. 767 billion could not be recovered due to various reasons and the recoverable amount is 175 billion rupees.   

They said that 37 billion rupees have been collected as tax arrears this year.