The Hon. (Dr.) (Ms.) Kaushalya Ariyarathne

¶ 01 Thank you, Hon. Deputy Chairperson.

¶ 02 I will begin by responding to the erroneous statement made by Hon. (Dr.) Harsha de Silva. I too was present at the Committee on Public Finance. When the Singapore FTA matter arose, we requested time to discuss and to take it up at the next meeting. We did not oppose it. Our team later returned and agreed. Please check the Minutes before making false claims.

¶ 03 [Interjections and Point of Order requests omitted for brevity; Chair assured full time to the Member.]

¶ 04 I will address frequently asked questions we encounter with the public, especially about Withholding Tax (WHT) on interest. Many elderly and retirees queued at the Inland Revenue Department fearing a 5% rate. From 1 April, procedures are in place: if your annual interest income is below Rs. 1.8 million, no WHT will be deducted. If you have fixed deposits generating less than Rs. 1.8 million per year in interest, you can file a single document with your bank to stop WHT from 1 April. From July, seniors will also receive an additional 3% interest on fixed deposits. Previously, a flat 5% was deducted irrespective of age; now, if annual interest is under Rs. 1.8 million, regardless of age, you can request no WHT. Note: receiving Rs. 1.8 million annually in interest generally implies a fixed deposit of around Rs. 20 million or more. Therefore, rumours that remittances from children abroad incur 15% tax or that small deposits are taxed via WHT are false.

¶ 05 Another issue is egg prices. Some claim VAT increased egg prices. The Deputy Ministers clarified: VAT registration applies only if annual turnover exceeds Rs. 60 million. We did not increase VAT on eggs from 1 January 2024; it remains as before. Rs. 60 million per year means over Rs. 5 million per month—only sizeable operations. The claim that VAT hikes drove egg prices is misleading.

¶ 06 On the other hand, we have removed VAT on milk and yoghurt. Apart from Highland, as far as I know, others have not passed this benefit to consumers. If VAT at 18% is removed, the benefit should reach consumers. We, as a Government, urge all dairy producers and retailers to pass on the VAT benefit, especially during the festive season.

¶ 07 Finally, on Aswesuma benefits: we discussed increasing coverage at the Committee on Public Finance; proposals are budgeted, with beneficiary families to be increased to 1.7 million. Selection was via a digital platform using multidimensional poverty criteria. Yet we found complaints in villages that eligible persons were excluded and ineligible persons included, sometimes due to data issues. The Government is taking steps; the Welfare Benefits Board will conduct an annual review and has received over 800,000 new applications. They are refining criteria and will revisit cases during the yearly review.

¶ 08 On the Prevention of Terrorism Act: until a new law on organized crime is enacted, existing law is used for detentions and investigations. The Minister informed the advisory committee that the PTA will be repealed soon and a committee appointed to bring the new law. We categorically state we oppose misuse of the PTA; work is underway to replace it. After the 2019 Easter attacks, despite available intelligence, action was not taken—leading to catastrophe. We must act lawfully and promptly to prevent a recurrence. I conclude.