Hon. (Dr.) Harsha de Silva

¶ 01 So, the technical point is this. He said you all are using an autoregressive distributed lag model. Of course, he did mention that there are certain changes he needs to make, and I accept that. But fundamentally, you use an autoregressive distributed lag model because the past and the future are connected. My question is this: if what we used for so long was a destructive economic policy, then how can the same model be used going forward? There has to be a break; then there must be a new work programme. I trust that as you go forward, you will present what that programme is.

¶ 02 Here, you spoke about a new era of revival. If the past consisted of destructive economic decisions, how do we proceed? Over the 15-year period versus the three-year period under your Government, what is the work plan to keep growth at a minimum of 4.2 per cent? In your policy statement, in the section on a democratic economy — a prosperous country — you state clearly a target of USD 120 billion GDP by 2030 through an unshaken productive economy with a human resource development plan and a technological innovation roadmap anchored in economic democracy. It says USD 120 billion. You do not have to wait until 2030; you will reach USD 120 billion much earlier. Hon. Deputy Minister, as the Deputy Minister of Finance you know this. The way I see it, this year the figure will be close to USD 100 billion. If so, how do you do this? You say you will take certain measures.

¶ 03 Members raised the issue of doctors leaving the country. Dr. Najith Indika said applications to the Australian Medical Council had increased by almost 100 per cent. That is true. You cited professional taxes as a cause. The promise made here in your policy statement says you would raise the personal annual tax-free threshold from Rs. 1.2 million to Rs. 2.4 million. Professionals voted for that. Now you say, “No, we cannot do that; we can only raise the Rs. 100,000 monthly threshold to Rs. 150,000.” Then you say you will claw back with a withholding tax, increasing it from 5 per cent to 10 per cent. We looked to see whether increasing withholding tax from 5 per cent to 10 per cent is stated anywhere in your policy statement. It is not stated anywhere. However, let me say this. Hon. Deputy Speaker, when we presented our policy statement we said, “We cannot take the Rs. 100,000 to Rs. 200,000 threshold immediately, but moving from Rs. 100,000 to Rs. 150,000, a 1 per cent tax is reasonable for the people.” Hon. Deputy Speaker, if someone earns Rs. 150,000 a month, Rs. 100,000 is tax-free. One per cent on the next Rs. 50,000 is Rs. 500. People will not oppose paying Rs. 500 tax if they earn Rs. 150,000 a month. But what you did was to abolish entire tax files.

¶ 04 By removing tax files, if someone has a second income — a shop, tuition — that income cannot be brought into tax because there is no tax file. We said, raise withholding tax in some form. But it would not affect those over 60 years; nor would it affect low-income groups.

¶ 05 We also said, Hon. Deputy Speaker, that if a refund is not paid within seven days, interest should accrue on that. Likewise, we proposed to structure VAT by properly classifying goods into bands because many people had difficulties and could not manage. We are not expecting that today, but we are watching how the Budget will present VAT bands at 18, 15, 12, 10 per cent, etc.

¶ 06 Next, you said VAT on items like milk, eggs, baby formula, pharmaceuticals, school books and supplies would be zero-rated. We are watching to see you zero-rate school supplies. A Hon. Lady Member said school supply subsidies were cut by 70 per cent and that mothers would suffer; they would spend for children, not themselves. We accept that. You promised those mothers: “Do not worry; we will zero-rate these taxes.” So we await the Budget to see that. You also said food would be zero-rated for VAT. Today, the Hon. Prime Minister has presented to the Committee on Public Finance a regulation relating to the Special Commodity Levy. It will be considered today or tomorrow. You are asking to carry forward the existing levies on imported foods like dhal, salmon, onions. But you say here that taxes will be removed. You can say many things; many can post 081011 on media. But there is a big disparity between what was promised at election time and what is said here after the election.

¶ 07 Hon. Deputy Speaker, I have today’s Daily Mirror. See the headline: “Queues are back people jostle for rice purchases in Ambalantota.” It further says: “...100 rice has shot up to Rs. 265 per kilo.” Red rice at Rs. 265. If that is false, sue them. If the media is misleading people, take action. What is the controlled price of red rice? The controlled price is Rs. 220; I think Nadu is Rs. 230. In the South we eat red rice; even Comrade Lal Kantha knows this. If we eat red rice, give us red rice. Hon. Prime Minister, you know that; you are from our area as well. But there is no red rice. We can talk about other things later; but there is no red rice. You had three months. You cannot now say you just arrived. In those three months, did you import at least 890,987,969.5 of red rice? No. See what happens next. We hear that the paddy price will be set at Rs. 110, while you fix the controlled rice price at Rs. 220 or Rs. 230. What did you do in 2023? There were big protests. Minister Samantha, please do not deny it; you said farmers should be paid around Rs. 130. Check what millers paid on election day.

¶ 08 They paid Rs. 130. Now you say you will fix the next season’s paddy price at Rs. 110. You boasted that you would buy 300,000 metric tons and fill storages. Fine, we hoped you could create a reasonable situation. But I do not believe that with 300,000 metric tons in store you can fix paddy at Rs. 110 while keeping controlled rice at Rs. 220 or Rs. 230. If you do that, in the next round the blow will fall not on consumers but on farmers. You told consumers VAT would be reduced, taxes cut, food taxes removed. The sad thing is they voted for you. Then you tell the farmer, “We cannot pay you Rs. 130.” We challenge you: if possible, pay Rs. 130 and fulfil your promise to the farmer. Say, “Yes, we fought on the streets for you; we will buy paddy at Rs. 130.” If you can do it, good. If not, why did you promise what you knew you could not do?