The Hon. (Dr.) Harsha de Silva

¶ 01 Hon. Deputy Speaker, the State Minister of Economic Development did not speak about what has been brought before the House today. We are not debating VAT today, are we? If I am wrong, tell me. Since he spoke about VAT, I will respond.

¶ 02 Hon. State Minister, you spoke entirely on a different subject, not relevant to today’s item. Therefore, I too must touch on a few points and then speak about the matter at hand. Do not try to stop that.

¶ 03 Since you raised VAT, let me clarify. VAT is 18 per cent. But there is also the 2.5 per cent SSCL. In banking, almost the entire value addition occurs there. When you add 18 per cent VAT and 2.5 per cent SSCL you call it 20.5 per cent. But you forgot to say that SSCL is charged on many goods and services, and value addition occurs at different stages. On a turnover basis, a 2.5 per cent SSCL often translates to at least 4 to 5 per cent on a value-added basis across the supply chain. Therefore, while you say VAT is 18 per cent, once SSCL is effectively added, it is at least around 22 per cent. If you say that is not the case, please explain how.