Performance Report 2007 - Department of Inland Revenue
Performance Report 2007 - Department of Inland Revenue
Performance Report 2007 - Department of Inland Revenue
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<strong>Performance</strong> <strong>Report</strong><br />
<strong>2007</strong><br />
DEPARTMENT OF INLAND REVENUE<br />
SRI LANKA
<strong>2007</strong><br />
<strong>Performance</strong> <strong>Report</strong><br />
DEPARTMENT OF INLAND REVENUE<br />
i
<strong>Department</strong>’s Mission<br />
• To collect taxes in-terms <strong>of</strong> relevant tax and other<br />
related laws, by encouraging voluntary compliance<br />
while deterring tax evasion and tax avoidance,<br />
and<br />
• To enhance public confidence in the tax system<br />
administered by the <strong>Department</strong> <strong>of</strong> <strong>Inland</strong> <strong>Revenue</strong><br />
by administering relevant tax and other related laws<br />
in a fair, friendly and expeditious manner and<br />
thereby facilitate a beneficial tax culture.<br />
-- Code <strong>of</strong> Ethics and Conduct--<br />
Strategic Goals<br />
• To improve voluntary compliance by taxpayers with<br />
the tax laws through programmes which encourage<br />
and assist that and detect those who do not comply<br />
and, where necessary, take appropriate corrective<br />
action.<br />
• To improve the effectiveness <strong>of</strong> the <strong>Department</strong> by<br />
the application <strong>of</strong> efficient work methods, technology<br />
and better utilization <strong>of</strong> available resources.<br />
• To enhance the productivity and pr<strong>of</strong>essionalism <strong>of</strong><br />
the staff through management and technical<br />
training, work experience, and thereby to enable<br />
them to contribute more effectively towards the<br />
fulfillment, by the <strong>Department</strong>, <strong>of</strong> its mission.<br />
ii
PRINCIPAL OFFICIALS<br />
Mr. A.A. Wijepala<br />
Commissioner General <strong>of</strong> <strong>Inland</strong> <strong>Revenue</strong><br />
Mr. S. Angammana<br />
Deputy Commissioner General<br />
Tax Surveillance, Risk Management and International Affairs<br />
Mr. E.A.S. Edirisinghe<br />
Deputy Commissioner General<br />
Tax Policy Planning & Development, Legislation, Rulings & BOI Enterprises<br />
Mr. R.K.H. Kaluarachchi<br />
Deputy Commissioner General<br />
Indirect Taxes & Communication Technology<br />
Mr. E.M.M. Medagoda<br />
Deputy Commissioner General<br />
Tax Administration<br />
Mr. H.M. Herath<br />
Deputy Commissioner General<br />
Human Resources<br />
iii
Mr. V.D.G.P. Ubesiri<br />
Senior Commissioner - Large Taxpayer Unit<br />
Mr. P. Wickramasena<br />
Senior Commissioner - Internal Audit<br />
Mr. K.M.S. Kandegedara<br />
Senior Commissioner- Zone 1<br />
Mrs. M. Samarasekera<br />
Commissioner-Value Added Tax<br />
Mr. K.L.S. Silva<br />
Commissioner-Assessment Control, Internal Audit/ Systems and Finance Audit<br />
Mr. H.B.A. Seneviratne<br />
Commissioner - Strategic & Operational Planning, Tax Policy & Rulings<br />
Mrs. D.M. Nandawathie<br />
Commissioner-Information and Non Filers & Stop Filers<br />
Mr. A.A. Amararatne<br />
Commissioner-Corporate Tax and Appeals<br />
Mr. R.K. Premadasa<br />
Commissioner-Tax Payer Services and Withholding Tax<br />
Mr. H.M. Abesinghe<br />
Commissioner-Human Resource Management<br />
Mr. P.D. Premaratne<br />
Commissioner-Investigation and Legal & Collection Clearance<br />
Mr. H.M. Premaratna Banda<br />
Commissioner-Large Tax Payers Unit<br />
Mr. S.T.Gobalasingham<br />
Commissioner-Zone III and ESC<br />
Mr. K.A.P. Kaluarachchi<br />
Commissioner- PAYE<br />
Mrs. W.B.S. Shanthikumar<br />
Commissioner-Employee Services<br />
Mrs. L. Ramanayake<br />
Commissioner-Human Resource Development<br />
Mr. W.M.W. Kumarasiri<br />
Commissioner-BOI & Investment Promotion and Stamp Duty<br />
Mr. W.M. Mendis<br />
Commissioner-Zone I<br />
Mr. A.L.A. Sirisena<br />
Commissioner-Metropolitan Branches<br />
Mrs. H.M.C.I. Gunasekera<br />
Commissioner-Collection<br />
Mr. W.V.P. Karunaratne<br />
Commissioner-Assessment Control “B”<br />
iv
Content<br />
YEAR <strong>2007</strong>–Noteworthy Achievements and Events in Brief….....................................................vi<br />
Organisation Chart...........................................................................................................................ix<br />
CHAPTOR 01- HUMAN RESOURCES ...................................................................................... 1<br />
1.1 Approved Cadre, the number in post and vacancies................................................................1<br />
1.2 Training........................................................................................................................................2<br />
1.2.1 Overseas Training ..................................................................................................................................2<br />
1.2.2 Overseas Training provided through the Fiscal Management Reform Programme. (FMRP).............3<br />
1.2.3 In-house Training...................................................................................................................................3<br />
1.3 Promotions ...................................................................................................................................5<br />
1.4 Recruitments ................................................................................................................................5<br />
1.5 Retirements ..................................................................................................................................5<br />
1.6 Disciplinary action.......................................................................................................................6<br />
CHAPTOR 02-REVENUE COLLECTION ................................................................................ 7<br />
2.1 Number <strong>of</strong> Taxpayers..................................................................................................................7<br />
2.2 Total <strong>Revenue</strong> ..............................................................................................................................8<br />
2.3. Income Tax Collection...............................................................................................................11<br />
2.3.1 Corporate and Non-corporate Income Tax..........................................................................................11<br />
2.3.2 Source wise Analysis <strong>of</strong> Income Tax Collection ................................................................................12<br />
2.3.3 Income Tax Return Filing Compliance 2002/2003 to 2006/<strong>2007</strong> ......................................................12<br />
2.3.4 PAYE Returns Filing Compliance-2006/<strong>2007</strong>....................................................................................13<br />
2.4 Economic Service Charge .........................................................................................................13<br />
2.5 Value Added Tax Collection.....................................................................................................14<br />
2.6 Stamp Duty Collection ..............................................................................................................16<br />
2.7 Betting & Gaming Levy Collection..........................................................................................17<br />
2.8 Debits Tax Collection ................................................................................................................17<br />
2.9 Share Transaction Levy ............................................................................................................18<br />
2.10 Construction Industry Fund Levy ...........................................................................................18<br />
2.11 <strong>Inland</strong> <strong>Revenue</strong> Collection 2003 to <strong>2007</strong>..................................................................................18<br />
2.12 <strong>Inland</strong> <strong>Revenue</strong> Contribution to the Government <strong>Revenue</strong> and GDP .................................19<br />
CHAPTOR 03-EXPENDITURE AND PRODUCTIVITY RATIO......................................... 21<br />
3.1 Comparison <strong>of</strong> the total expenditure incurred during the year with 2005 and 2006. .........22<br />
3.2 Analysis <strong>of</strong> the Recurrent Expenditure in <strong>2007</strong>......................................................................23<br />
3.3 Productivity Ratio .....................................................................................................................23<br />
CHAPTOR 04-TAXES IN DEFAULT ....................................................................................... 25<br />
CHAPTOR 05-INTERNATIONAL RELATIONS ................................................................... 27<br />
5.1 Double Tax Treaties ..................................................................................................................27<br />
5.2 Participations at International Taxation Matters Abroad ....................................................28<br />
CHAPTOR 06-LEGISLATION .................................................................................................. 29<br />
6.1 Legislation made during the year.............................................................................................29<br />
6.2 Rulings Given During The Year...............................................................................................29<br />
6.3 Approved Charities ...................................................................................................................30<br />
CHAPTOR 07-AUDITS, ADDITIONAL TAX COLLECTIONS, RECOVERY ACTIONS<br />
AND APPEALS.................................................................................................. 31<br />
7.1 Particulars <strong>of</strong> Audits and Additional Tax Collection during the year. (Rs: Mn) ................31<br />
7.2 Additional information on Additional Taxes ..........................................................................31<br />
7.3 Appeals .......................................................................................................................................32<br />
7.4 Board <strong>of</strong> Review.........................................................................................................................32<br />
CHAPTOR 08-TAX PAYER SERVICES.................................................................................. 33<br />
Annexure I…………………………...………………………………………………………… 35<br />
Annexure II……………………………..………………………………………………………..37<br />
v
YEAR <strong>2007</strong>–Noteworthy Achievements and Events in Brief…<br />
The year <strong>2007</strong> was a jubilant year for the <strong>Department</strong> <strong>of</strong> <strong>Inland</strong> <strong>Revenue</strong> which was established in<br />
1932, as it celebrated the 75 th anniversary during the year. Many special activities were organized<br />
in parallel to the commemoration <strong>of</strong> this Platinum jubilee event. The <strong>Department</strong> administered 9<br />
types <strong>of</strong> taxes viz: Value Added Tax , Income Tax, Economic Service Charge, Debits tax, Stamp<br />
Duty, Share Transaction Levy, Social Responsibility Levy and Betting & Gaming Levy,<br />
Construction Industry Guarantee Fund Levy, during this year.<br />
o Commemoration <strong>of</strong> 75 th Anniversary: Campaigns were arranged with a view to make the<br />
public aware <strong>of</strong> the mission <strong>of</strong> the <strong>Department</strong>; encourage the taxpayers for improved tax<br />
payments; and to emphasize the importance <strong>of</strong> paying tax. These campaigns were carried out<br />
mainly through the print media, electronic media, posters, brochures etc. and by the “<strong>Inland</strong><br />
<strong>Revenue</strong> Walk”.<br />
The campaign titled “Payment <strong>of</strong> Tax is Your Responsibility” was launched with the theme<br />
that the payment <strong>of</strong> taxes is the responsibility <strong>of</strong> a good citizen who in turn deserves the<br />
recognition and respect therefor. The objectives <strong>of</strong> this campaign were to create a positive<br />
perception among the public towards the voluntary payment <strong>of</strong> taxes to the State for the use in<br />
development activities, and to communicate that the payment <strong>of</strong> tax is a responsibility <strong>of</strong><br />
citizens rather than an obligation.<br />
“Rata Venuven Api” campaign was another, to emotionally motivate voluntary payment <strong>of</strong><br />
taxes and to communicate how the people voluntarily paying their taxes become stakeholders<br />
in the nation building process.<br />
o <strong>Revenue</strong>: the <strong>Department</strong> achieved a total collection <strong>of</strong> Rs. 308.2 Billion revenue during the<br />
year in keeping with the continued increasing trends in the revenue collection. This year the<br />
total collection <strong>of</strong> the <strong>Department</strong> constituted 54.54% <strong>of</strong> the Government revenue 1 , which is<br />
a contribution <strong>of</strong> 8.1% to the GDP at current market prices. Though this collection was<br />
marginally lower than the expected revenue (revised estimate <strong>of</strong> revenue), it is significantly<br />
higher than the previous year’s collection. This was achieved despite the fact that the<br />
<strong>Department</strong> had to train almost 55% <strong>of</strong> the staff newly recruited during the year.<br />
o Recruitments: 267 new Assessors, and 527 new Tax Officers, were recruited to the<br />
<strong>Department</strong> during the year, resolving a major part <strong>of</strong> the staff shortage problem, which had<br />
considerably affected the performance <strong>of</strong> the <strong>Department</strong>.<br />
1 Govt. revenue as reflected in the year <strong>2007</strong> Annual <strong>Report</strong> <strong>of</strong> Ministry <strong>of</strong> Finance<br />
vi
o New Regional Offices and branches: A new Regional Office was opened as scheduled in<br />
January at Yakkala to facilitate and deal with taxpayers in the Gampaha Region, and a Special<br />
VAT Audit Branch was established to expedite the post audit process <strong>of</strong> VAT refund cases.<br />
Another branch (Advance VAT) was opened at the Head Office to implement the Withholding<br />
Tax System introduced to VAT.<br />
o Tax payer Services: Services provided at the Taxpayer Service Unit housed in the ground<br />
floor <strong>of</strong> the <strong>Inland</strong> <strong>Revenue</strong> Building were streamlined for the taxpayers and the public to<br />
improved access for information and get the services conveniently. The Unit has been<br />
provided with Officers to assist every person seeking help and information. Relevant<br />
enactments, departmental publications, paying-in-slips, forms etc. are made available in this<br />
Unit. Taxpayer Identification Numbers (TINs) and temporary VAT Numbers are issued at this<br />
Unit. During the year, 10,458 Tax Payers Identification certificates and 14,249 temporary<br />
VAT registration certificates were issued. On an average the services were obtained by<br />
approximately 250 persons a day during this year.<br />
o Tax Payer Education: Seminars and lectures on tax related matters and procedures were<br />
organized to educate taxpayers and upgrade the skills <strong>of</strong> the staff <strong>of</strong> the <strong>Department</strong>.<br />
Several seminars were held in Colombo and other provissional cities. 14 seminars were held<br />
within Colombo District and 6 seminars were held respectively at Bandarawela, Kurunegala,<br />
Ratnapura, Polgahwela, NuwaraEliya, and Badulla.<br />
o Issuing privilege Cards and Car permits to good Taxpayers: The process <strong>of</strong> issuing<br />
privilege cards to individual taxpayers to recognize their contribution to the Government<br />
<strong>Revenue</strong> and to make them entitled to certain benefits such as preferential treatments at<br />
Government Agencies, continued with added modes. During the year, 152 individual<br />
taxpayers were awarded with Gold Cards and 252 individual with Silver Cards. Further, 202<br />
certificates were issued, on request, to individual taxpayers who had paid income tax for the<br />
last 5 consecutive years in excess <strong>of</strong> Rs 250,000/- per year, in support and confirming their<br />
entitlement to tax and duty rebate on the importation <strong>of</strong> a motor vehicle.<br />
o Computer Training Center: the “Computer Training Center” set up in 2006 continued<br />
providing training and during the year 557 Officers were trained.<br />
o Provision <strong>of</strong> Overseas & local Training: The Overseas training program were carried out<br />
continuously, particularly, to provide the Officers an exposure on tax policies in other<br />
countries and to upgrade their skills and knowledge. A Special program <strong>of</strong> training organized<br />
with the assistance <strong>of</strong> FMRP enabled altogether 514 <strong>of</strong>ficers <strong>of</strong> all ranks from Commissioner<br />
vii
downwards to be trained in India, during this year. Further, 33 Officers selected under normal<br />
selection program participated in training programs conducted in other countries. In addition<br />
all the Commissioners and Deputy Commissioners participated in a special overseas training<br />
program on “Investigation and Management Course conducted at National Tax Academy <strong>of</strong><br />
Direct Taxes, India.<br />
o VAT Refunds: To streamline and to expedite VAT refund without delays a system <strong>of</strong><br />
releasing refunds on Bank guarantees submitted by registered exporters were introduced<br />
during the year. This refund process was further facilitated through opening <strong>of</strong> a special<br />
account at the Central Bank to cater to such refunds. Accordingly, 7150 refunds have been<br />
issued during the year.<br />
viii
Organisation Chart<br />
(As at 31-12-<strong>2007</strong>)<br />
Board <strong>of</strong> Review<br />
Ombudsman<br />
Commissioner General /<br />
Chairman - <strong>Revenue</strong> Board<br />
Secretary to the <strong>Revenue</strong> Board<br />
Senior Commissioner: Internal Audit<br />
Commissioner: System & Finance Audit<br />
Deputy Commissioner<br />
Chief Accountant<br />
Senior Deputy Commissioner<br />
General<br />
Building Engineer<br />
Commissioner:<br />
Procurement &<br />
Supplies<br />
Commissioner:<br />
Appeals<br />
Deputy<br />
Commissioner<br />
DCG:<br />
Tax Administration<br />
• Commissioner:<br />
Taxpayer Services<br />
[TS]<br />
• Commissioner: Audit<br />
[Aud]<br />
• Commissioner:<br />
Collection &<br />
Enforcement [C&E]<br />
• Commissioner:<br />
Returns & Payment<br />
Processing [R&PP]<br />
DCG: ICT<br />
[Chief Information Officer]<br />
• Commissioner: ICT I<br />
[ICT Manager,<br />
Developments & Reforms]<br />
• Commissioner: ICT II<br />
ICT Manager, Projects &<br />
Engineering]<br />
• DC: Application &<br />
Database Development<br />
Unit [Team Leader]<br />
• DC: Network Operations<br />
Centre [Team Leader]<br />
• DC: ICT Reforms<br />
• DC: Special Projects<br />
DCG: HRM<br />
• Commissioner:<br />
Human<br />
Resources<br />
• Commissioner:<br />
Human<br />
Resource<br />
Development<br />
• Commissioner:<br />
Employee<br />
Services<br />
• HR Specialist I **<br />
• HR Specialist II<br />
DCG: Tax<br />
Surveillance & Risk<br />
Management and<br />
International Affairs<br />
• Commissioner:<br />
Investigation<br />
• Commissioner:<br />
International<br />
Affairs<br />
• Commissioner:<br />
Information &<br />
Non Filers & Stop<br />
Filers<br />
Deputy<br />
Commissioner<br />
DCG: Tax Policy<br />
Planning &<br />
Development,<br />
Legislation, Rulings<br />
& BOI Enterprises<br />
• Commissioner:<br />
Strategic and<br />
Operational<br />
Planning, Tax<br />
Policy Planning,<br />
Legislation , and<br />
Rulings<br />
• Commissioner:<br />
BOI & Investment<br />
Promotion<br />
• Commissioner:<br />
Research & Policy<br />
• Policy, Planning & Standards Guidance **<br />
• Database Administrator<br />
• Application Developer<br />
• Hardware, Network & System Administrator<br />
• Cyber Security & Risk Administrator<br />
• Data Centre Administrator<br />
• e-Government<br />
• Emerging Technology<br />
• Intranet/Web Developer<br />
• S<strong>of</strong>tware Engineering & QA<br />
• IT Helpdesk<br />
• ICT Competitive Outsourcing<br />
Training Centre<br />
Deputy<br />
Commissioner<br />
• Tax Policy Analyst **<br />
• Fiscal Policy Expert<br />
• Economist<br />
• Financial Analyst<br />
• Legal Officer<br />
• Research Assistant<br />
• Statistician<br />
Senior Commissioner: Tax<br />
Administration - Zone 1<br />
Senior Commissioner:<br />
Tax Administration - LTU<br />
Senior Commissioner:<br />
Tax Administration -<br />
Zone 2<br />
Senior Commissioner:<br />
Tax Administration -<br />
Zone 3<br />
• Commissioner: Colombo<br />
Regional Offices, VAT,<br />
Stamp Duty, Unit 3 and ESC<br />
• Commissioner: LTU,<br />
Corporate Tax & Debits<br />
Tax<br />
• Commissioner: South<br />
Region<br />
• Commissioner: North<br />
Region<br />
Deputy Commissioners<br />
Deputy Commissioners<br />
Deputy Commissioners<br />
Deputy Commissioners<br />
GIR<br />
ix
CHAPTER 1<br />
HUMAN RESOURCES<br />
1.1 Approved Cadre, the number in post and vacancies.<br />
The following Table shows the approved Cadre <strong>of</strong> the <strong>Department</strong>, the actual number in post and<br />
the vacancies, as at December 31, <strong>2007</strong>.<br />
Cadre <strong>of</strong> the <strong>Department</strong> as at 31.12.<strong>2007</strong><br />
Grade<br />
Approved<br />
Cadre<br />
Number in<br />
post Vacancies<br />
Commissioner General 1 1 -<br />
Senior Deputy Commissioner General 1 - 1*<br />
Deputy Commissioner General 6 5 1<br />
Senior Commissioner 5 3 2<br />
Commissioner 22 21** 1<br />
Deputy Commissioner 90 82 8<br />
Senior Assessor 57<br />
Assessor 750<br />
627 66<br />
Assessor (Supernumerary)<br />
47 -<br />
Senior Tax Officer 158<br />
Tax Officer 1000<br />
544 298<br />
Other<br />
- Director (Administration) 1 1 -<br />
-Engineer 1 1 -<br />
-System Analyst 6 1 5<br />
-Librarian 1 1 -<br />
- Accountant 7 7 -<br />
-Stamp Clerk 1 1 -<br />
-System Controller 3 3 -<br />
-Computer Operator 11 4 7<br />
-Data Entry Operator 18 8 10<br />
-System Manager 2 2 -<br />
-Budget Assistant 2 2 -<br />
-Receptionist 4 4 -<br />
-Store-man 3 2 1<br />
-Carpenter 1 1 -<br />
-Building Supervisor 1 - 1<br />
-Supply Assistant 1 - 1<br />
Combined Services<br />
- Public Management Assistant 311 237 74<br />
-Translator 9 9 -<br />
-Driver 74 70 4<br />
- K K S 319 313 6<br />
Total 2651 2212 486<br />
* This post was not filled, as the recruitment procedure had not been finalized.<br />
** 3 posts were filled in 2008, with effect from respective dates in the year <strong>2007</strong>.<br />
1
1.2 Training<br />
1.2.1 Overseas Training<br />
Exposure <strong>of</strong> <strong>of</strong>ficers <strong>of</strong> the <strong>Department</strong> to the advances made in the administration <strong>of</strong> taxes and<br />
best practices <strong>of</strong> other Countries has been recognized by the <strong>Department</strong> as a necessity to<br />
maintain a level <strong>of</strong> pr<strong>of</strong>essionalism <strong>of</strong> <strong>of</strong>ficers as tax administrators. Accordingly, arrangements<br />
were made for several <strong>of</strong>ficials to participate in training programmes, seminars or workshops held<br />
abroad.<br />
Details <strong>of</strong> such <strong>of</strong>ficials who have been sent and the training programs they participated are as<br />
follows:<br />
Name & Designation<br />
<strong>of</strong> the Officer<br />
Name <strong>of</strong> the Programme Country <strong>of</strong> Duration<br />
Training<br />
1 Mr. A A Wijepala - CGIR The valediction function <strong>of</strong> Investigation & India 15-16 Dec. <strong>2007</strong><br />
Management Training Course<br />
2 Mr. E M M Medagoda - DCGIR i.) 12th Annual International Taxation Meeting France 19-21 Sep. <strong>2007</strong><br />
on Tax Treaties<br />
ii.) Study Tour (under FMRP Project)<br />
Hong Kong &<br />
Phillippines<br />
26-29 Nov. <strong>2007</strong><br />
3 Mr. H M Herath - DCGIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. <strong>2007</strong><br />
4 Mrs. Anula Senevirathna SCIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. <strong>2007</strong><br />
5 Mrs M Samarasekara - CIR 2nd Country Study Visit <strong>of</strong> MPM Programme Thailand 01-15 Sep. <strong>2007</strong><br />
6 Mr. A A Amararathna - CIR 12th Annual International Taxation Meeting France 19-21 Sep. <strong>2007</strong><br />
on Tax Treaties<br />
7 Mr. R K Premadasa - CIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. <strong>2007</strong><br />
8 Mrs. L. Ramanayake - CIR 2nd Country Study Visit <strong>of</strong> MPM Programme Thailand 01-15 Sep. <strong>2007</strong><br />
9 Mr. A L A Sirisena - CIR 12th Annual International Taxation Meeting France 19-21 Sep. <strong>2007</strong><br />
on Tax Treaties<br />
10 Mrs. K Dahanayake - CIR 2nd Country Study Visit <strong>of</strong> MPM Programme Thailand 01-15 Sep. <strong>2007</strong><br />
11 Mr. H N S Siriwardana - DC Workshop on "Taxation <strong>of</strong> International<br />
Malaysia 06-24 Aug. <strong>2007</strong><br />
Transactions"<br />
12 Mrs. R Wijesinghe - DC Principles <strong>of</strong> International Taxation Netherlands<br />
29 Jan-02 Feb.<br />
<strong>2007</strong><br />
13 Mr.K H N C Perera - DC Principles <strong>of</strong> International Taxation Netherlands<br />
29 Jan.-02Feb.<br />
<strong>2007</strong><br />
14 Mrs. S N P Abrew - DC Principles <strong>of</strong> International Taxation Netherlands<br />
29 Jan.-02Feb.<br />
<strong>2007</strong><br />
15 Mr. P L A Liyanage - DC Principles <strong>of</strong> International Taxation Netherlands<br />
29 Jan.-02Feb.<br />
<strong>2007</strong><br />
16 Mr. A A Dayarathne - DC Macro Economic Management and Fiscal Singapore<br />
29Oct.-09 Nov.<br />
<strong>2007</strong><br />
Policy Programme<br />
17 Mr. B G Piyadasa - DC Principles <strong>of</strong> International Taxation Netherlands<br />
29 Jan.-02Feb.<br />
<strong>2007</strong><br />
18 Mrs. Vijitha Paranamana - DC Interpretation & Application <strong>of</strong> the Tax Treaties Netherlands 05 -07 Mar. <strong>2007</strong><br />
19 Mr. E Shelton Soysa - DC Introduction to European Value Added Tax Netherlands 12-15 Mar <strong>2007</strong><br />
20 Mr. U P S A Jayalath - DC Study Tour (under FMRP Project) Hong Kong &<br />
Phillippines<br />
21 Mrs. N K A I K Gunarathna Tax Analysis and <strong>Revenue</strong> Forecasting U.S.A<br />
- SA Programme<br />
22 Mr. O W N Gunasekara Tax Analysis and <strong>Revenue</strong> Forecasting U.S.A<br />
2<br />
26-29 Nov. <strong>2007</strong><br />
15 Jul. - 10 Aug.<br />
<strong>2007</strong><br />
15 Jul. - 10 Aug.<br />
<strong>2007</strong>
- SA Programme<br />
23 Mr. R M D Banda Principles <strong>of</strong> International & Comparative Taxation Netherlands<br />
20 Aug.-01 Sep.<br />
<strong>2007</strong><br />
- SA<br />
24 Mr. G D S Jayarathna 2nd Country Study Visit <strong>of</strong> MPM Programme Thailand 01-15 Sep. <strong>2007</strong><br />
- SA<br />
25 Mr. S M A Bandara Tax Analysis and <strong>Revenue</strong> Forecasting U.S.A<br />
15 Jul. - 10 Aug.<br />
<strong>2007</strong><br />
- SA Programme<br />
26 Mrs. D W N Wijekoon Tax Analysis and <strong>Revenue</strong> Forecasting U.S.A<br />
15 Jul. - 10 Aug.<br />
<strong>2007</strong><br />
- SA Programme<br />
27 Mrs. K G C Priyadarshani Advanced Management Potential (AMP) U.K<br />
30 Jul.-14 Sep.<br />
<strong>2007</strong><br />
- SA<br />
28 Mrs. R P H Fernando Fiscal Planning, Management & Reforms India 17-28 Dec. <strong>2007</strong><br />
- Assessor Programme (under FMRP Project)<br />
29 Mr. B K Saman Santha Commonwealth Tax Inspectors Course (CTIC) U.K<br />
30 Jul.-14 Sep.<br />
<strong>2007</strong><br />
- Assessor<br />
30 Mr. Avantha Walimini Master's Degree Programme on Korean Economy Korea 27.12.<strong>2007</strong><br />
- Assessor & Business (to 18.02.2009)<br />
31 Mr. N Ariyathilaka Study Tour (under FMRP Project)<br />
Hong Kong &<br />
Phillippines<br />
26-29 Nov. <strong>2007</strong><br />
System Administrator<br />
32 Mr. P G Siridasa Training Programme at INGAF India<br />
26 Feb.-13 Mar.<br />
<strong>2007</strong><br />
- Chief Accountant<br />
1.2.2 Overseas Training provided through the Fiscal Management Reform Programme.<br />
(FMRP)<br />
Under the auspices <strong>of</strong> FMRP, the training programme on “Practical Issues <strong>of</strong> Tax Policy & Tax<br />
Administration in Developing Countries” conducted in India was continued during this year as well.<br />
Each batch <strong>of</strong> <strong>of</strong>ficers who participated in that programme included a Commissioner and <strong>of</strong>ficers<br />
selected from all other grades below the grade <strong>of</strong> Commissioner. In addition, 88 <strong>of</strong>ficers<br />
participated in the specialized training programme on Audit and Investigation, International<br />
Taxation and management organized by the National Academy <strong>of</strong> Direct Taxes <strong>of</strong> India. The<br />
details <strong>of</strong> the <strong>of</strong>ficers who participated in this training programme are given in the Annexure I.<br />
1.2.3 In-house Training<br />
Training Branch <strong>of</strong> the <strong>Department</strong> conducts training courses and examinations for Assessors and<br />
Tax <strong>of</strong>ficers, regularly. This is aimed at enhancing the knowledge and improving analytical skills,<br />
particularly in taxation and accountancy. Emphasis is given in providing the training on subjects<br />
that is required to fulfill various service requirements <strong>of</strong> <strong>of</strong>ficers in <strong>of</strong>ficial activities, in addition<br />
to achieve a sufficient level <strong>of</strong> competency for their confirmation in the respective grades. Details<br />
<strong>of</strong> personnel trained and the examinations conducted during the year are as follows:<br />
3
1) Training for Assessors –<br />
I. 106 Assessors in the Class 2, Grade II (promoted on 03.08.2005), were<br />
trained for the Preliminary <strong>Department</strong>al Examination<br />
II.<br />
68 Assessors in Class 2 Grade II were trained for the Final <strong>Department</strong>al<br />
Examination.<br />
III. Training classes were conducted for 17 Assessors (promoted on 20.06.2003)<br />
for their final <strong>Department</strong>al examination to be held in 2009.<br />
IV.<br />
Training Classes were conducted for Assessors who were recruited on<br />
02.10.2006 and 01.01.<strong>2007</strong> (a total <strong>of</strong> 479 in number) for the Preliminary<br />
<strong>Department</strong>al Examination to be held in 2008.<br />
V. 18 Assessors in Class 2 Grade II (recruited on 03.05.<strong>2007</strong>) were trained for<br />
the Preliminary <strong>Department</strong>al Examination to be held in 2009.<br />
2) Training for Tax Officers<br />
• 36 Tax Officers in Class 3 Grade I were trained to enabled them to get the<br />
eligibility to the promotion to Class 2 Grade II.<br />
• 506 Tax Officers in Class 3 Grade II were trained for the examinations to be<br />
held in 2008 for confirmation in Class 3 Grade II<br />
3) Examinations for Assessors:<br />
Examination Held in Number<br />
Sat<br />
01 Preliminary Examination for Assessors<br />
in Class 2 Grade II (Repeat- 3 rd attempt)<br />
02 Final <strong>Department</strong>al Examination for<br />
Assessors in Class 2 Grade II<br />
03 Final <strong>Department</strong>al Examination for<br />
Assessors in Class 2 Grade II (Repeat –<br />
2 nd attempt)<br />
04 Final <strong>Department</strong>al Examination for<br />
Assessors in Class 2 Grade II (Repeat-<br />
3 rd attempt)<br />
10.05.<strong>2007</strong> to<br />
16.05.<strong>2007</strong><br />
10.05.<strong>2007</strong> to<br />
17.05.<strong>2007</strong><br />
13.08.<strong>2007</strong> to<br />
17.08.<strong>2007</strong><br />
10.09.<strong>2007</strong> to<br />
12.09.<strong>2007</strong><br />
01 01<br />
57 32<br />
25 22<br />
3 3<br />
Number<br />
Successful<br />
4) Examinations for Tax <strong>of</strong>ficers:<br />
Examination Held in Number<br />
Sat<br />
Number<br />
Successful<br />
01 Examination for 3-II Tax Officers for<br />
confirmation in 3 –I and eligibility for<br />
promotion to 2-II<br />
07.11.<strong>2007</strong> 36 32<br />
4
5) Seminars conducted:<br />
Date<br />
Subject<br />
21.02.<strong>2007</strong> Conducting a Rapid Audit (1)<br />
07.03.<strong>2007</strong> Conducting a Rapid Audit (2)<br />
21.03.<strong>2007</strong> Practical Approach to VAT I<br />
28.03.<strong>2007</strong> Conducting a Rapid Audit (3)<br />
27.04.<strong>2007</strong> Practical Approach to VAT II<br />
04.07.<strong>2007</strong> Problematic Areas <strong>of</strong> VAT<br />
18.07.<strong>2007</strong> Examinations <strong>of</strong> Forged Documents<br />
08.08.<strong>2007</strong> Recent Amendments to Income Tax & Value Added Tax<br />
6) Business Communication Program:<br />
Training classes were organized for Business Communication, through the British Council<br />
for Deputy Commissioners, Assessors and Tax Officers, under the auspicious <strong>of</strong> FRM<br />
Project.<br />
7) Other<br />
Four Orientation Programmes for Assessors and Tax Officers recruited in <strong>2007</strong> were<br />
conducted during the year.<br />
1.3 Promotions<br />
The following Deputy Commissioners were promoted to the rank <strong>of</strong> Commissioner:<br />
Name<br />
Date <strong>of</strong> Promotion<br />
Mr. S Rajapakse 08.03.<strong>2007</strong><br />
Mr. P A V Premaratne 08.06.<strong>2007</strong><br />
Mrs. K Dahanayake 14.06.<strong>2007</strong><br />
19 Assessors were promoted to the grade <strong>of</strong> Senior Assessor with effect from 10.09.<strong>2007</strong>.<br />
36 Tax Officers were also promoted to the grade <strong>of</strong> Senior Tax Officer effective from 01.07.<strong>2007</strong><br />
1.4 Recruitments<br />
Human Resources <strong>Department</strong> concentrated its resources to complete the recruitment process<br />
during the year. Accordingly, 267 Assessors and 527 Tax Officers were recruited on the basis <strong>of</strong><br />
the results <strong>of</strong> Open Competitive Examination held in mid 2006.<br />
1.5 Retirements<br />
The following Officers retired during the Year.<br />
Senior Commissioners<br />
o Mrs. Anula Senevirathne<br />
o Mr. H A Somapala<br />
5
Commissioners<br />
o Mr. W. Auther Fernando<br />
o Mr. W. Thilakaratne<br />
o Mrs. R.A.M.A. Herath<br />
Deputy Commissioners<br />
o Mrs. K.P.M.Gunatilake<br />
o Mr. H.H.R.Somasiri<br />
o Mr. B.M.Ariyadasa<br />
o Mr. U.B.Keerthisinghe<br />
Other<br />
Mr. H.A. Somapala<br />
Senior Assessor 1<br />
Assessors 34<br />
Senior Tax Officer 1<br />
Public Management Assistants 4<br />
K K S 5<br />
Building Supervisor 1<br />
Mr. Somapala retired from the <strong>Inland</strong> <strong>Revenue</strong> Service on October 3, 2008. At the time <strong>of</strong> his<br />
retirement he held the post <strong>of</strong> Senior Commissioner in charge <strong>of</strong> the Zone III Region <strong>of</strong> the<br />
<strong>Department</strong>. Having begun the career in the <strong>Department</strong> on 1 st March 1966 as a young member<br />
<strong>of</strong> the General Clerical Service, he served with dedication for a period as long as 41 years in<br />
the respective capacities up to the rank <strong>of</strong> Senior Commissioner.<br />
Mr. Somapala, during the tenure <strong>of</strong> his <strong>of</strong>fice, participated at the CATA Regional Training<br />
Programme held in Ghana in 1995 and followed a programme on application <strong>of</strong> tax treaties in<br />
Korea in 2001.<br />
Mrs. A. Seneviratne<br />
Mrs. Seneviratne joined the <strong>Department</strong> on December 1, 1968 as a member <strong>of</strong> general clerical<br />
service. At the time <strong>of</strong> her retirement from service on September 14, <strong>2007</strong>, she had been<br />
functioning as the Senior Commissioner in charge <strong>of</strong> Zone II Region. Mrs. Seneviratne counted<br />
39 years in the <strong>Department</strong>, extending a devoted service in every assigned area. During her tenure<br />
<strong>of</strong> <strong>of</strong>fice, she followed a Policy Workshop on Bench Marking & ISO 9000 in Malaysia in 2001<br />
and participated at the 28th CATA Annual Technical Conference held in Kenya in <strong>2007</strong>.<br />
1.6 Disciplinary action<br />
Category Balance O/S on<br />
01. 01. <strong>2007</strong><br />
Concluded during<br />
the year<br />
Balance O/S on 31.<br />
12.<strong>2007</strong><br />
Tax Officer 3 1 2<br />
Assessor 2 1 1<br />
Deputy Commissioner 1 1<br />
6
CHAPTER 2<br />
REVENUE COLLECTION<br />
The <strong>Department</strong> <strong>of</strong> <strong>Inland</strong> <strong>Revenue</strong> being the main contributor to the Government’s revenue is<br />
entrusted with an immense responsibility <strong>of</strong> collecting revenue to the Government. Hence, a<br />
concerted effort was made to fulfill the revenue requirements <strong>of</strong> the Government to keep ahead in<br />
line with the mission <strong>of</strong> the <strong>Department</strong>. The <strong>Department</strong> collected a net revenue <strong>of</strong> Rs.<br />
308,205,526,964/- (including Social Responsibility levy) during the year. This sum reflects an<br />
increase <strong>of</strong> Rs. 54.9 Billion (21.67%) over that <strong>of</strong> the year 2006. This <strong>Revenue</strong> was built up by<br />
attending 583,365 tax payers during the year. Out <strong>of</strong> which, 324,268 employees were paying<br />
income tax under PAYE scheme for which separate tax files were not maintained by the<br />
<strong>Department</strong>.<br />
2.1 Number <strong>of</strong> Taxpayers<br />
The number <strong>of</strong> persons registered with the <strong>Department</strong> for the payment <strong>of</strong> tax, as at the end <strong>of</strong> the<br />
year, is given in Table 01.<br />
Table 01<br />
Income Tax.<br />
Corporate<br />
Number <strong>of</strong> Taxpayers as at 31-12-<strong>2007</strong><br />
• Resident Companies 24,132<br />
• Non-Resident Companies 523<br />
• State Corporations, Statutory Boards and State owned institutions<br />
195<br />
Non Corporate<br />
• Individuals 163,438<br />
• Partnerships<br />
15,373<br />
• Bodies <strong>of</strong> Persons etc.<br />
1,932<br />
• Employees paying income tax under Pay-As-You-Earn (PAYE) Scheme 324,268<br />
(as at 31-03-<strong>2007</strong>)<br />
Total Income Taxpayers 529,861<br />
Employers Registered under PAYE Scheme<br />
Persons and Partnerships registered for Economic Service Charge (ESC)<br />
Persons registered for Value Added Tax (VAT)<br />
Persons registered for Debits Tax<br />
Betting Levy Files<br />
13,236<br />
8,910<br />
29,537<br />
854<br />
963<br />
Gaming Levy Files 4<br />
Total Number <strong>of</strong> taxpayers as at 31-12-<strong>2007</strong><br />
583,365<br />
Note: (i) A separate file is not generally maintained in the <strong>Department</strong> in respect <strong>of</strong> any employee<br />
from whom remuneration tax is deducted under PAYE Scheme unless such employee has<br />
any other income.<br />
(ii).Individuals whose income is taxed at source as a final tax (such as interest on deposits,<br />
Treasury Bills, Dividends etc) are not included.<br />
7
2.2 Total <strong>Revenue</strong> Collection<br />
The increase <strong>of</strong> Rs. 54.9 Billion or 21.67% over that <strong>of</strong> the year 2006,was mainly due to the<br />
continuous efforts made during the year by further strengthening tax administration, streamlining<br />
tax incentives and exemptions, enhancing tax compliance, strengthening enforcement and prompt<br />
enactment <strong>of</strong> revenue related legislation.<br />
The ratio <strong>of</strong> the total <strong>Inland</strong> <strong>Revenue</strong> contribution to the Government revenue in the year was<br />
54.54%. However, the total revenue was little lower than the revenue estimate for the year under<br />
review. This is mainly due to the provision <strong>of</strong> tax concessions on import <strong>of</strong> several essential<br />
commodities to counter the rising cost <strong>of</strong> goods and services, and declined vehicle imports in the<br />
year because people preferred importation low value vehicles in the face <strong>of</strong> high import duty<br />
imposed on fuel inefficient vehicles as a measure <strong>of</strong> managing the impact <strong>of</strong> escalating oil prices.<br />
Further, the introduction <strong>of</strong> new provisions in relation to the electricity and gas sectors and the<br />
setback in the hotel sector, were the main contribution factors to the above situation in addition<br />
the negative growth in the manufacturing sector, taxation relief on Tsunami projects and<br />
suspension scheme to deemed exporters through TQB and EDB too brought about somewhat<br />
unfavorable results as against the previous years. There is a considerable decrease in the<br />
collection <strong>of</strong> VAT. Hotel sector did not develop up to the expected levels volume <strong>of</strong> imports had<br />
not been upwards trend compared to previous years.<br />
Certain tax concessions on VAT were granted on essential goods. The loss <strong>of</strong> Value Added Tax<br />
revenue anticipated through these concessions has been estimated at Rs. 2273 ♣ Million.<br />
A comparison <strong>of</strong> collection under each type <strong>of</strong> tax with the corresponding estimate is given in<br />
Table 02 and illustrates in Chart 01. The Cash Flow during the year is shown in the Table 03, and<br />
is illustrated by Chart 02.<br />
♣ Ministry <strong>of</strong> Finance Annual <strong>Report</strong> -<strong>2007</strong><br />
8
Table -02<br />
Total <strong>Revenue</strong> Collection-<strong>2007</strong><br />
Type <strong>of</strong> Tax<br />
<strong>Revenue</strong> Estimate<br />
Rs:<br />
<strong>Revenue</strong> Collection<br />
Rs:<br />
Collection<br />
as a % <strong>of</strong><br />
Estimate<br />
Collection<br />
as a % <strong>of</strong><br />
Total<br />
<strong>Revenue</strong><br />
Income Tax 99,479,000,000 94,964,974,986 95.46% 30.81%<br />
Economic Service Charge 14,345,000,000 12,203,425,025 85.07% 3.96%<br />
Debits Tax 8,141,000,000 7,186,742,288 88.28% 2.33%<br />
Betting & Gaming Levy 500,000,000 267,573,250 53.51% 0.09%<br />
Share Transaction Levy 400,000,000 412,083,582 103.02% 0.13%<br />
Stamp Duty 4,200,000,000 4,026,242,048 95.86% 1.31%<br />
Capital Transfer 100,000,000 7,532 0.01% 0.00%<br />
Construction Industry Levy 30,000,000 56,449,361 188.16% 0.02%<br />
Value Added Tax 201,643,000,000 186,990,550,020 92.73% 60.67%<br />
Goods & Services Tax 142,172,771 0.05%<br />
Turnover Tax 100,000,000 461,361,956 461.36% 0.15%<br />
National Security Levy 105,013,759 0.03%<br />
Total 328,938,000,000 306,816,596,578 93.27% 99.55%<br />
Social Responsibility Levy 892,000,000 1,388,930,385 155.71% 0.45%<br />
Total <strong>Revenue</strong> 329,830,000,000 308,205,526,964 93.44% 100.00%<br />
Chart 01<br />
Total <strong>Revenue</strong> Collection- <strong>2007</strong><br />
200,000<br />
VAT<br />
IT<br />
180,000<br />
ESC<br />
Rs: Millions<br />
160,000<br />
140,000<br />
120,000<br />
100,000<br />
80,000<br />
60,000<br />
40,000<br />
20,000<br />
0<br />
IT<br />
ESC<br />
DT<br />
B&GL<br />
STL<br />
SD<br />
CT<br />
Type <strong>of</strong> Tax 1<br />
CIL<br />
GST<br />
TT<br />
NSL<br />
SRL<br />
DT<br />
B&GL<br />
STL<br />
SD<br />
CT<br />
CIL<br />
VAT<br />
GST<br />
TT<br />
NSL<br />
SRL<br />
9
Table -03<br />
Cash Flows- <strong>2007</strong><br />
Month<br />
<strong>Revenue</strong> Collection<br />
Rs:<br />
SRL (RS.)<br />
Cumulative <strong>Revenue</strong><br />
Collection Rs:<br />
January-07 22,706,315,593 522,872.31 22,706,838,465<br />
February-07 24,055,427,147 3,735,534.80 46,766,001,147<br />
March-07 20,538,476,396 665,406.21 67,305,142,949<br />
April-07 24,318,955,838 782,558.36 91,624,881,346<br />
May-07 24,614,878,115 92,764,020.40 116,332,523,481<br />
June-07 20,506,064,107 12,227,870.41 136,850,815,458<br />
July-07 25,707,208,267 10,271,752.03 162,568,295,478<br />
August-07 31,610,773,198 236,151,214.85 194,415,219,890<br />
September-07 28,193,115,392 630,333,074.20 223,238,668,357<br />
October-07 29,506,455,866 147,847,097.20 252,892,971,320<br />
November-07 29,439,756,981 236,607,542.30 282,569,335,843<br />
December-07 25,619,169,678 17,021,442.95 308,205,526,964<br />
Chart 02<br />
Cash Flow-<strong>2007</strong><br />
350,000<br />
300,000<br />
250,000<br />
Rs: Million<br />
200,000<br />
150,000<br />
100,000<br />
50,000<br />
-<br />
1 2 3 4 5 6 7 8 9 10 11 12<br />
Months<br />
<strong>Revenue</strong> Collection<br />
Cummulative <strong>Revenue</strong> Collection<br />
10
2.3. Income Tax Collection<br />
Income tax collection for the year was Rs. 94.96 Billion. This is an increase <strong>of</strong> 30.99% over that<br />
<strong>of</strong> the previous year. The Income tax collection accounts for 30.52% <strong>of</strong> the total revenue <strong>of</strong> the<br />
<strong>Department</strong>.<br />
‣ During the year, several policy measures were introduced to rationalize the income<br />
taxes, which gave positive and negative results to the income tax collection.<br />
‣ During the year, gross Income Tax collection from employees (Under PAYE Scheme)<br />
recorded Rs. 11.2 Billion. Withholding Tax on Interest at 10% and Specified Fees at<br />
5% generated Rs.25.4 Billion and Rs.9.9 Billion respectively.<br />
2.3.1 Corporate and Non-corporate Income Tax<br />
Out <strong>of</strong> the total collection <strong>of</strong> Rs.94.96 billion, the contribution from the corporate sector amounted<br />
to Rs. 43.45 billion or 45.75 % whereas the non corporate sector contribution amounted to<br />
Rs.51.52 billion or 54.25%.<br />
Table 04 shows the composition to Income Tax collection, and Chart 03 illustrates the same with<br />
percentages.<br />
Table - 04<br />
Corporate and Non-corporate Income Tax Collection -<strong>2007</strong><br />
Sector Tax Collection (Rs:) %<br />
Corporate 43,447,026,332 45.75%<br />
Non-Corporate 51,517,948,654 54.25%<br />
Total 94,964,974,986 100.00<br />
Chart 03<br />
Income Tax collection <strong>2007</strong><br />
Non-<br />
Corporate,<br />
54%<br />
Corporate,<br />
46%<br />
11
2.3.2 Source wise Analysis <strong>of</strong> Income Tax Collection<br />
Table 05 shows the source wise composition (employment and others) <strong>of</strong> income tax<br />
collected during the year.<br />
Table 05<br />
Income Tax Collection- <strong>2007</strong><br />
Source wise Analysis (Employees and Others)<br />
Source<br />
Collection (Rs. Mn)<br />
Employment<br />
PAYE Scheme 11,075.1 0<br />
Self Assessment and Assessments<br />
with penalties for tax in default 278.2 11,353.3<br />
Others<br />
Self Assessment and Assessments<br />
with penalties for tax in default 45,728.1<br />
Withholding Tax on Interest, Rent &<br />
Specified Fees 35,317.8<br />
Other Deductions at Source 2,816.9<br />
Compounding Penalties 0.3 83,863.1<br />
Gross Collection 95,216.4<br />
Less: Refunds (251.2)<br />
Net Collection 94,965<br />
2.3.3 Income Tax Return Filing Compliance 2002/2003 to 2006/<strong>2007</strong><br />
The programme for enhancing taxpayer compliance in timely filing tax returns and paying<br />
taxes on self assessment basis continued during the year under review.<br />
Table 06<br />
Income Tax Return Compliance 2002/03 to 2006/07<br />
Year <strong>of</strong><br />
Assessment<br />
Sector<br />
Compliance<br />
on Due Date<br />
%<br />
Compliance after<br />
one month from<br />
the due date<br />
%<br />
Corporate 31% 48%<br />
2002/2003 Non-corporate 32% 47%<br />
Corporate 50% 58%<br />
2003/2004 Non-corporate 32% 41%<br />
Corporate 37% 43%<br />
2004/2005 Non-corporate 28% 41%<br />
Corporate 34% 44%<br />
2005/2006 Non-corporate 33% 44%<br />
Corporate 36% 42%<br />
2006/<strong>2007</strong> Non- corporate 26% 42%<br />
12
2.3.4 PAYE Returns Filing Compliance-2006/<strong>2007</strong><br />
Year <strong>of</strong><br />
Assessments<br />
Table 07<br />
PAYE Returns Filing Compliance-2006/<strong>2007</strong><br />
Description<br />
Compliance as at<br />
30/04/<strong>2007</strong><br />
Compliance as at<br />
31/12/<strong>2007</strong><br />
2006/<strong>2007</strong> PAYE Returns 18% 47%<br />
2.4 Economic Service Charge<br />
During the year, 2351 new ESC files were opened making the total to 8910 as at 31-12-<strong>2007</strong>. ESC<br />
amounting to Rs. 12,203 Mn contributed 3.96% to the total collection. It is an increase <strong>of</strong> 37.8%<br />
and Rs. 3,350.5 Mn over that <strong>of</strong> 2006. Notices <strong>of</strong> assessments, 5114 in number were issued in<br />
respect <strong>of</strong> non payment <strong>of</strong> taxes on the return while 1,136 notices <strong>of</strong> assessments on others were<br />
issued during the year. A shortage <strong>of</strong> around 15% in the collection <strong>of</strong> ESC as against the estimate<br />
and this could be attributable to amendments made to the law during the mid <strong>of</strong> the year.<br />
Table 8<br />
Corporate and Non Corporate Economic Service Charge Collection – <strong>2007</strong><br />
ESC Collection (Rs.) %<br />
Corporate 11,148,253,944 91.35<br />
Non Corporate 1,055,171,080 8.65<br />
Total 12,203,425,024 100.00<br />
Chart 05<br />
Economic Service Charge Collection - <strong>2007</strong><br />
Non Corporate<br />
Sector, 9%<br />
Corporate Sector,<br />
91%<br />
13
2.5 Value Added Tax Collection<br />
The Value Added Tax (VAT) collection <strong>of</strong> Rs. 186.99 Billion during the year indicates a shortfall<br />
<strong>of</strong> Rs: 14.6 Billion over the estimated amount <strong>of</strong> Rs: 201.6 Billion for the year. However, this is<br />
an increase <strong>of</strong> Rs: 22.9 billion or 13.96% over that <strong>of</strong> the previous year. VAT represents 60.67%<br />
<strong>of</strong> the total revenue collection in the year. The number <strong>of</strong> permanent VAT registered persons<br />
rose up to 29,537 with the opening 2,819 new VAT files during the year.<br />
In order to maintain revenue at desired level, restrictions were introduced in relation to deduction<br />
<strong>of</strong> input tax, to the lower <strong>of</strong> actual input tax or 85% <strong>of</strong> the output tax, with carry forward<br />
provisions <strong>of</strong> the balance.<br />
However these restrictions are not applicable to-<br />
‣ any supplier whose supplies are zero rated;<br />
‣ any supplier who is registered with TQB or EDB for the supply <strong>of</strong> goods or certain<br />
services to exporters;<br />
‣ any person registered under Sec. 22 (7) <strong>of</strong> the VAT Act.<br />
Further, provisions were introduced to withhold 1 / 3 <strong>of</strong> VAT payable to contractors and any other<br />
service providers, on supplies made to Government Agencies.<br />
In order to mitigate the impact <strong>of</strong> undervaluation, the markup applicable on CIF value on<br />
importation has been increased to 10%.<br />
VAT Rate Changes<br />
‣ VAT payable on ticketing machine (used in Busses) tax was reduced by 5%;<br />
‣ VAT payable on supply <strong>of</strong> Jewellery was reduced from 20% to 5% w.e.f. 01.01.<strong>2007</strong>;<br />
‣ VAT payable on high tech Medical equipment was reduced to 5% from 15%.<br />
VAT Exemptions<br />
‣ Production, Distribution and exhibiting <strong>of</strong> any film;<br />
‣ Supply <strong>of</strong> laboratory services for film industry;<br />
‣ Importation <strong>of</strong> any film produced in Sri Lanka and taken abroad for further<br />
processing or printing with the approval <strong>of</strong> the NFC;<br />
‣ Chartering <strong>of</strong> Vessels;<br />
‣ Importation <strong>of</strong> any Bus by any Bus owner holding a valid route permit;<br />
‣ Supply <strong>of</strong> electricity, generation and distribution <strong>of</strong> electricity w.e.f.01.01.<strong>2007</strong>;<br />
‣ Machinery and equipments imported by Ceylon Electricity Board (CEB) and<br />
private power suppliers;<br />
‣ Import or supply <strong>of</strong> furnace oil;<br />
‣ Supply <strong>of</strong> locally manufactured Handloom textile w.e.f.01.01.<strong>2007</strong>;<br />
‣ Machinery imported for modernization <strong>of</strong> Tea Rubber and Coconut Processing;<br />
14
‣ Supply <strong>of</strong> prawns, importation <strong>of</strong> cattle, buffaloes etc. and livestock breeding<br />
items.<br />
In addition, steps were taken to streamline and expedite the refund process that witnessed<br />
considerable delays. Table 09 shows the Value Added Tax gross collection and refunds, and<br />
Table 10 shows the Value Added Tax (net) Collection sector wise, and is illustrated by Chart 05.<br />
Table 10 (a) shows the Domestic VAT Industry Wise analysis which highlights the increase in the<br />
year compared to 2006 in all domestic sectors such as Banking, Insurance, Hotel & Restaurant,<br />
Construction, Electricity & Gas, Imports and Financing. Collection <strong>of</strong> VAT on imports in the year<br />
reached to Rs. 101.5 Billion recording 54.28% out <strong>of</strong> total collection <strong>of</strong> VAT.<br />
Table 09<br />
Value Added Tax gross collection and refunds.<br />
Sector<br />
Gross Collection<br />
(Rs.Mn)<br />
Refunds (Rs.Mn) Net Collection (Rs.Mn)<br />
Manufacturing 32,482 9,959 22,523<br />
Non- Manufacturing 62,966.9 - 62,966.9<br />
Imports 101,500.9 0.339 101,500.6<br />
Total 196,949.8 9,959.339 186,990.5<br />
Table 10<br />
Value Added Tax Collection<br />
Sector<br />
Net Collection<br />
% <strong>of</strong> VAT Collection to GDP<br />
%<br />
(Rs:)<br />
<strong>2007</strong> 2006<br />
Manufacturing Sector 22,523,044,458 12.05% 0.6296 0.756<br />
Non Manufacturing Sector 62,966,901,977 33.67% 1.7601 1.68<br />
On Imports 101,500,603,584 54.28% 2.8372 3.1467<br />
Total 186,990,550,019 100% 5.2269 5.5827<br />
Chart 05<br />
Value Added Tax Collection-<strong>2007</strong><br />
Manufacturing<br />
Sector, 12%<br />
On Imports, 54%<br />
Non-Manufacturing<br />
Sector, 34%<br />
15
Table 10 (a)<br />
Gross Domestic VAT – Main Manufacturing and Service Sectors<br />
Year 2006<br />
(Rs.Mn)<br />
Year <strong>2007</strong><br />
(Rs.Mn)<br />
%<br />
Increase/decrease<br />
Banking 7,400.82 9,689.07 31%<br />
Insurance 2,402.60 3,264.29 36%<br />
Hotel & Restaurant 2,028.02 2,364.22 17%<br />
Construction 3,828.15 6,408.16 67%<br />
Electricity & Gas 3,106.62 543.45 -83%<br />
Imports 6,439.82 9,620.29 49%<br />
Financing 5,541.82 7,530.80 36%<br />
Communication 4,570.92 5,139.21 12%<br />
Petroleum Product 1,307.41 2,878.38 120%<br />
Beverage –Alcoholic 5,694.06 6,466.00 14%<br />
Services not classified 4,800.59 5,854.48 22%<br />
Manufacturing not classified 4,127.29 5,582.66 35%<br />
Others 31,522.88 30,033.99 -5%<br />
Total 82,771.00 95,375.00 15%<br />
2.6 Stamp Duty Collection<br />
Rs. 4,026 Mn generated from Stamp Duty during the year. This is an increase <strong>of</strong> 169.3% over that<br />
<strong>of</strong> previous year.<br />
During the year an Order under Section 5 <strong>of</strong> the Stamp Duty Act was made to exempt documents<br />
for the issue or transfer <strong>of</strong> units <strong>of</strong> unit trusts or mutual funds.<br />
Moreover, 159 numbers <strong>of</strong> advisory and supervisory visits have been made.<br />
Following table highlights the percentages <strong>of</strong> the Stamp Duty collected from different<br />
instruments.<br />
Table 11<br />
Instrument wise analysis <strong>of</strong> stamp duty<br />
Type <strong>of</strong> Instrument<br />
Percentages<br />
Policy <strong>of</strong> Insurance 0.44%<br />
Licenses 0.43%<br />
Credit Card Transactions 21.04%<br />
Lease, Rent or Hire 32.85%<br />
Receipts for Remuneration 2.97%<br />
Other Receipts 16.63%<br />
Share certificates 25.16%<br />
North and East Provinces 0.21%<br />
Other 0.24%<br />
Total 100%<br />
16
2.7 Betting & Gaming Levy Collection<br />
During the year, collection <strong>of</strong> Betting and Gaming Levy was marginally declined by Rs. 14.6 Mn<br />
when compared with that <strong>of</strong> 2006. Though Betting Levy rates have been increased during the<br />
previous year, the collection <strong>of</strong> Betting & gaming Levy recorded only Rs. 267.6 Mn during the<br />
year.<br />
Table 12 compares the revenue estimate <strong>of</strong> Betting & Gaming Levy with the collection for the<br />
year, and Chart 06 illustrates it.<br />
Table 12<br />
Collection <strong>of</strong> Betting & Gaming Levy- <strong>2007</strong><br />
<strong>Revenue</strong> Estimated (Rs:) <strong>Revenue</strong> Collected (Rs:) %<br />
500,000,000 267,573,250 53.51<br />
Chart 06<br />
Collection <strong>of</strong> Betting & Gaming Levy <strong>2007</strong><br />
Rupees<br />
500,000,000<br />
400,000,000<br />
300,000,000<br />
200,000,000<br />
100,000,000<br />
<strong>Revenue</strong><br />
Estimated<br />
<strong>Revenue</strong><br />
Collection<br />
-<br />
1<br />
Betting & Gaming Levy<br />
2.8 Debits Tax Collection<br />
Debits Tax generated Rs. 7,186.7 Mn and constituted 2.33% <strong>of</strong> the total revenue collection in the<br />
year. Debits Tax collection was only marginally below the target <strong>of</strong> Rs.8,141 Mn set for the year.<br />
However, Debits tax collection <strong>of</strong> the year reflects a 14.9% growth over the corresponding<br />
collection in 2006.<br />
Table 13 compares the revenue estimate <strong>of</strong> Debits Tax with the revenue collected in the year, and<br />
the Chart 07 illustrates it.<br />
Table 13<br />
Debits Tax Collection - <strong>2007</strong><br />
Estimated <strong>Revenue</strong><br />
(Rs:)<br />
<strong>Revenue</strong> Collection<br />
(Rs:) %<br />
8,141,000,000 7,186,742,288 88.28<br />
17
Chart 07<br />
Debit Tax Collection -<strong>2007</strong><br />
9,000<br />
8,000<br />
7,000<br />
Rs. Million<br />
6,000<br />
5,000<br />
4,000<br />
3,000<br />
2,000<br />
1,000<br />
-<br />
Estimated<br />
<strong>Revenue</strong><br />
1Debit Tax<br />
<strong>Revenue</strong><br />
Collection<br />
2.9 Share Transaction Levy<br />
Share Transaction Levy contributed Rs. 412 Mn marginally declining from Rs. 420.2 Mn<br />
collected in the previous year.<br />
The Table 14 shows the estimate for the year and the amount collected.<br />
Table 14<br />
Share Transaction Levy - <strong>2007</strong><br />
Estimated <strong>Revenue</strong> (Rs:) <strong>Revenue</strong> Collection (Rs:) %<br />
400,000,000 412,083,582 103.02<br />
2.10 Construction Industry Fund Levy<br />
<strong>Revenue</strong> collection from Construction Industry Fund Levy, exceeded the <strong>Revenue</strong> estimate by Rs.<br />
26 Mn or 88% by contributing Rs. 56 Mn to the total <strong>Revenue</strong>.<br />
Finance Act No. 5 was amended to empower the Commissioner General <strong>of</strong> <strong>Inland</strong> <strong>Revenue</strong> to<br />
administer the Construction Industry Fund Levy.<br />
2.11 <strong>Inland</strong> <strong>Revenue</strong> Collection 2003 to <strong>2007</strong><br />
Figures in Table 15 represent the tax wise classification <strong>of</strong> revenue collection <strong>of</strong> the <strong>Department</strong>,<br />
from 2003 to <strong>2007</strong>.<br />
18
Type <strong>of</strong> Tax<br />
Table 15<br />
<strong>Inland</strong> <strong>Revenue</strong> Collection 2003 to <strong>2007</strong> – Tax wise Analysis<br />
2003 2004 2005 2006 <strong>2007</strong><br />
Colln. % Colln. % Colln. % Colln. % Colln.<br />
(Rs.Mn) (Rs. Mn)<br />
(Rs. Mn) (Rs.Mn) (Rs.Mn)<br />
%<br />
Income Tax<br />
Economic Service<br />
Charge<br />
Value Added Tax<br />
Debits Tax<br />
Betting & Gaming Levy<br />
Share Transaction Levy<br />
Turnover tax<br />
Stamp Duty<br />
Estate Duty<br />
Goods & Services Tax<br />
National Security Levy<br />
Construction Industry<br />
Social Responsibility<br />
Levy<br />
38,602<br />
-<br />
97,754<br />
3,601<br />
56<br />
-<br />
4<br />
69<br />
-<br />
(759)<br />
(284)<br />
27.76<br />
70.30<br />
2.59<br />
0.04<br />
0.00<br />
0.05<br />
-0.55<br />
-0.20<br />
37,904.0<br />
4,052.8<br />
117,030.9<br />
4,488.8<br />
77.1<br />
-<br />
106.2<br />
51.3<br />
0.4<br />
852.6<br />
239.9<br />
23.00<br />
2.46<br />
71.01<br />
2.72<br />
0.05<br />
0.06<br />
0.03<br />
0.00<br />
0.52<br />
0.15<br />
42,154.8<br />
7,283.1<br />
141,877.9<br />
5,700.8<br />
196.4<br />
451.2<br />
143.1<br />
8.9<br />
0.5<br />
448.9<br />
34.6<br />
21.26<br />
3.67<br />
71.55<br />
2.87<br />
0.10<br />
0.23<br />
0.07<br />
0.00<br />
0.00<br />
0.23<br />
0.02<br />
71,481.5<br />
8,852.9<br />
164,070.8<br />
6,254.8<br />
282.2<br />
420.2<br />
232.6<br />
1,495.2<br />
0.6<br />
135.7<br />
92.6<br />
28.22<br />
3.49<br />
64.77<br />
2.47<br />
0.11<br />
0.17<br />
0.09<br />
0.59<br />
0.00<br />
0.05<br />
0.04<br />
94,965<br />
12,203<br />
186,991<br />
7,187<br />
268<br />
412<br />
461<br />
4,026<br />
0<br />
142<br />
105<br />
56<br />
1,389<br />
30.8<br />
1<br />
3.96<br />
60.6<br />
7<br />
2.33<br />
0.09<br />
0.13<br />
0.15<br />
1.31<br />
0.00<br />
0.05<br />
0.03<br />
0.02<br />
0.45<br />
139,043 100 164,804 100 198,300 100 253,319 100 308,205<br />
100<br />
2.12 <strong>Inland</strong> <strong>Revenue</strong> Contribution to the Government <strong>Revenue</strong> and Gross<br />
Domestic Product (GDP)<br />
Table 16 shows the contribution <strong>of</strong> the <strong>Inland</strong> <strong>Revenue</strong> <strong>Department</strong> to the Government revenue<br />
and the GDP, in <strong>2007</strong> and its trends in the last 4 years. Chart 08 illustrates these contributions.<br />
Total Government revenue in <strong>2007</strong> has increased to Rs. 565,051 Mn (as per the Annual <strong>Report</strong> <strong>of</strong><br />
Central Bank <strong>of</strong> Sri Lanka -<strong>2007</strong>) while the ratio <strong>of</strong> the total <strong>Inland</strong> <strong>Revenue</strong> collection to the<br />
Government revenue, continued its increasing trend and reached 54.54% in the year. The ratio <strong>of</strong><br />
<strong>Department</strong>s collection to GDP is in the increasing direction.<br />
19
Year<br />
Table 16<br />
Contribution to the Government <strong>Revenue</strong> and GDP at Current Factor Prices<br />
Governments<br />
<strong>Revenue</strong> Rs. Mn<br />
IRD's Collection<br />
Rs.Mn<br />
% <strong>of</strong> IRD's<br />
Collection to<br />
Govt.<br />
<strong>Revenue</strong><br />
GDP at Current<br />
Prices <strong>of</strong> Major<br />
Economic Activities<br />
Rs.Mn<br />
% <strong>of</strong> IRD's<br />
Collection to<br />
GDP<br />
2003 276,465 139,044 50.29% 1,822,468 7.63%<br />
2004 311,473 164,803 52.91% 2,090,841 7.88%<br />
2005 379,747 198,301 52.22% 2,452,782 8.08%<br />
2006 477,334 253,319 53.07% 2,938,656 8.62%<br />
<strong>2007</strong> 565,051* 308,205 54.54% 3,577,438** 8.61%<br />
*Source – Central Bank <strong>of</strong> Sri Lanka (Annual <strong>Report</strong>- <strong>2007</strong>)<br />
Provisional Figures<br />
** Source – Central Bank <strong>of</strong> Sri Lanka (Annual <strong>Report</strong>- <strong>2007</strong>)<br />
<strong>Department</strong> <strong>of</strong> Census and Statistics<br />
Chart 08<br />
Contribution <strong>of</strong> the IRD's Collection to the Government<br />
<strong>Revenue</strong> 2003 to <strong>2007</strong><br />
600,000<br />
500,000<br />
Rs. Million<br />
400,000<br />
300,000<br />
200,000<br />
100,000<br />
-<br />
2003 2004 2005 2006 <strong>2007</strong><br />
Years<br />
Government <strong>Revenue</strong><br />
IRD Collection<br />
20
CHAPTER 3<br />
EXPENDITURE AND PRODUCTIVITY RATIO<br />
Total expenditure <strong>of</strong> the <strong>Department</strong> in the year reached Rs. 1,208 Mn recording a 10% increase<br />
compared to the previous year figure Rs.1,084 Mn. Out <strong>of</strong> the total expenditure, 90% or Rs. 1,090<br />
Mn was incurred as recurrent expenditure which is an increase <strong>of</strong> 31.6% over Rs. 746 Mn in<br />
2006. Expenditure on emoluments increased by 34% to 877Mn from 579Mn in 2006, mainly due<br />
to the new recruitments (<strong>of</strong> Assessors and Tax Officers) during the year. This was the highest<br />
single expenditure item which accounted for 72.59% <strong>of</strong> total expenditure and 80% <strong>of</strong> recurrent<br />
expenditure.<br />
Capital expenditure during the year discontinued its increasing trends recording a drastic decrease<br />
<strong>of</strong> 65% compared to 2006 and reached Rs. 117Mn. This is mainly due to the decrease in<br />
“Acquisitions”. However, with the intention <strong>of</strong> increasing the productivity <strong>of</strong> the <strong>Department</strong>, 7<br />
Motor Vehicles, Computers and 55 Photocopy Machines were purchased during the year. In<br />
addition to the items <strong>of</strong> “Reconstruction and Improvements” and “Acquisitions”, Rs. 3.6Mn was<br />
incurred on “Skill Development Program” which was not an item reflected in previous years.<br />
Audits carried out by the Internal Audit Branch included examining <strong>of</strong> all payment vouchers<br />
relating to capital and recurrent expenditure, daily vehicle running charts maintained by the Head<br />
<strong>of</strong>fice and Regional <strong>of</strong>fice, pay sheets, the Board <strong>of</strong> Survey reports, the Appropriation Account for<br />
the year 2006 and refund <strong>of</strong> VAT. Moreover, submission <strong>of</strong> replies to the audit quires raised by<br />
the Auditor General, examining the action taken to recover the amounts due on dishonored<br />
cheques, checking <strong>of</strong> salary conversions under Public Administration Circular No. 6/2006(1),<br />
examining the revenue accounts relating to VAT and Income Tax and the examining the refund <strong>of</strong><br />
taxes were the other main tasks performed by the Internal Audit Branch. After carrying out the<br />
above functions recommendations have been made to minimize the deficiencies observed in their<br />
examinations.<br />
21
3.1 Comparison <strong>of</strong> the total expenditure incurred during the year with 2005 and<br />
2006.<br />
Table 17<br />
Total Expenditure- 2005, 2006 and <strong>2007</strong><br />
Description 2005 (Rs:'000) % 2006 (Rs:'000) % <strong>2007</strong> (Rs:'000) %<br />
Recurrent Expenditure<br />
Emoluments 467,061 59.18% 579,251 53.42% 876,799 72.59%<br />
Traveling 4,105 0.52% 8,072 0.74% 11,385 0.94%<br />
Supplies & Equipments 20,595 2.61% 30,633 2.83% 34,857 2.89%<br />
Repairs & Maintenance 20,199 2.56% 28,877 2.66% 20,739 1.72%<br />
Contracted Services 62,484 7.92% 81,174 7.49% 138,523 11.47%<br />
Transfers 649 0.08% 779 0.07% 8,068 0.67%<br />
Other Recurrent Exp. 42,195 5.35% 17,303 1.60% - 0.00%<br />
Modernization Programme - 0.00% - 0.00% - 0.00%<br />
Sub Total 617,288 746,089 1,090,371<br />
Capital Expenditure<br />
Reconstruction and Improvements 13,290 1.68% 22,986 2.12% 43,207 3.58%<br />
Acquisitions 158,641 20.10% 315,158 29.07% 70,723 5.85%<br />
Skill Development - 0.00% - 0.00% 3,650 0.30%<br />
Sub Total 171,931 338,144 117,580<br />
Total 789,219 100% 1,084,233 100% 1,207,951 100%<br />
Chart 10<br />
Capital<br />
Expen<br />
diture,<br />
22%<br />
2005<br />
Capital<br />
Expen<br />
diture,<br />
31%<br />
2006<br />
Capita<br />
l<br />
Expen<br />
diture,<br />
10%<br />
<strong>2007</strong><br />
Recurr<br />
ent<br />
Expen<br />
diture,<br />
78%<br />
Recurr<br />
ent<br />
Expen<br />
diture,<br />
69%<br />
Recurr<br />
ent<br />
Expen<br />
diture,<br />
90%<br />
22
3.2 Analysis <strong>of</strong> the Recurrent Expenditure in <strong>2007</strong><br />
Chart 11<br />
Recurrent Expenditure <strong>2007</strong><br />
Contracted<br />
Servises, 13%<br />
Transferes, 1%<br />
Other Recurrent<br />
Expenditure, 0%<br />
Repairs &<br />
Maintenance, 2%<br />
Supplies &<br />
Equipments, 3%<br />
Traveling, 1%<br />
Emoluments, 80%<br />
3.3 Productivity Ratio<br />
The total expenditure <strong>of</strong> the <strong>Department</strong> in the year was Rs. 1,207,951,000 and the <strong>Revenue</strong><br />
collected was Rs. 308,205,526,964. The Productivity Ratio (i.e. the revenue collected for every<br />
rupee <strong>of</strong> expenditure) therefore, works out to 255:1. In other words, the cost <strong>of</strong> collection <strong>of</strong> Rs.<br />
100 was 39 cents. Even though the total expenditure <strong>of</strong> the <strong>Department</strong> in the year recorded a<br />
10% increase, the cost <strong>of</strong> collection per Rs.100 recorded 9.3% decrease as the total revenue<br />
collection grown up by 22%, when compared with 2006. The Cost <strong>of</strong> collection per Rs. 100,<br />
excluding VAT on Imports accounted 58 cents. Table 18 provides a classification <strong>of</strong> <strong>Revenue</strong><br />
Collection, Total Expenditure and the cost <strong>of</strong> collection from the year 2005 to the year <strong>2007</strong>.<br />
23
Table 18<br />
<strong>Revenue</strong> Collection, Total Expenditure and Cost <strong>of</strong> Collection (Rs. Mn)<br />
<strong>Revenue</strong> Collection<br />
Income Tax<br />
Economic Service Charge<br />
Value Added Tax<br />
Debits Tax<br />
Betting & Gaming Levy<br />
Share Transaction Levy<br />
Turnover Tax<br />
Stamp Duty<br />
Estate Duty<br />
Goods & Services Tax<br />
National Security Levy<br />
Construction Industry<br />
Social Responsibility Levy<br />
2005 2006 <strong>2007</strong><br />
42,154.8<br />
7,283.1<br />
141,877.9<br />
5,700.8<br />
196.4<br />
451.2<br />
143.1<br />
8.9<br />
0.5<br />
448.9<br />
34.6<br />
-<br />
-<br />
71,481.5<br />
8,852.9<br />
164,070.8<br />
6,254.8<br />
282.2<br />
420.2<br />
232.6<br />
1,495.2<br />
0.6<br />
135.7<br />
92.6<br />
-<br />
***<br />
94,964.9<br />
12,203.4<br />
186,990.6<br />
7,186.7<br />
267.6<br />
412.1<br />
461.4<br />
4,026.2<br />
0<br />
142.2<br />
105.0<br />
56.5<br />
1,388.9<br />
Total 198,300.2 253,319.1 308,205.5<br />
Expenditure<br />
Recurrent Expenditure<br />
Emoluments<br />
Traveling<br />
Supplies & Equipment<br />
Repairs & Maintenance<br />
Contracted Services<br />
Transfers<br />
Others<br />
467.1<br />
4.1<br />
20.6<br />
20.2<br />
62.5<br />
0.6<br />
42.2<br />
579.3<br />
8.1<br />
30.6<br />
28.8<br />
81.1<br />
0.8<br />
17.3<br />
876.8<br />
11.4<br />
34.9<br />
20.7<br />
138.5<br />
8.1<br />
-<br />
Capital Expenditure<br />
Reconstruction & Improvements<br />
Acquisitions<br />
Skill Development<br />
13.3<br />
158.6<br />
-<br />
22.9<br />
315.2<br />
-<br />
43.2<br />
70.7<br />
3.6<br />
Total Expenditure 789.2 1,084.1 1,207.9<br />
Cost <strong>of</strong> Collection per Rs.100, Rs. 0.40 0.43 0.39<br />
Cost <strong>of</strong> Collection per Rs. 100, excluding VAT on Imports, Rs. 0.58<br />
*** Included under Income tax.<br />
24
CHAPTER 4<br />
TAXES IN DEFAULT<br />
Table 19 shows the amounts <strong>of</strong> Taxes in default, the taxes held over and the collectible taxes in<br />
default, as at 31-12-<strong>2007</strong>.<br />
Type <strong>of</strong> Tax<br />
Income Tax<br />
Gross Tax in<br />
Default<br />
Rs.<br />
Table 19<br />
Analysis <strong>of</strong> the default taxes<br />
Total<br />
Penalty *<br />
Rs.<br />
Total Default<br />
Tax without<br />
Penalty<br />
Rs.<br />
Disputed Tax<br />
without<br />
Penalty<br />
Rs.<br />
Collectible Tax<br />
(without<br />
penalty)<br />
Rs.<br />
56,116,027,728 16,135,372,663 39,980,655,065 23,055,561,724 16,925,093,341<br />
Surcharge on Income<br />
Tax<br />
1,462,506,074 311,594,266 1,150,911,808 360,683,142 790,228,666<br />
Value Added Tax 76,765,683,735 20,455,190,044 56,310,493,691 37,897,340,419 18,413,153,272<br />
VAT on Financial<br />
Service<br />
292,596,103 45,500,385 247,095,718 247,095,718 -<br />
Economic Service<br />
Charge<br />
3,549,754,707 943,329,146 2,606,425,561 97,326,949 2,509,098,612<br />
Wealth Tax 109,987,698 - 109,987,698 57,285,177 52,702,521<br />
Surcharge on Wealth<br />
Tax<br />
3,677,694 - 3,677,694 2,141,423 1,536,271<br />
Gift Tax 16,009,967 - 16,009,967 5,298,381 10,711,586<br />
Estate Duty 35,830,929 11,945,542 23,885,387 - 23,885,387<br />
Stamp Duty 70,960,648 - 70,960,648 70,960,648 -<br />
Goods & Services Tax 8,859,880,017 1,932,203,337 6,927,676,680 1,932,203,337 4,995,473,343<br />
Turnover Tax 6,714,339,116 1,899,187,994 4,815,151,122 1,437,228,290 3,377,922,832<br />
National Security<br />
Levy<br />
4,761,641,085 1,199,366,565 3,562,274,520 1,058,370,528 2,503,903,992<br />
Save the Nation<br />
Contribution<br />
53,341,590 11,071,094 42,270,496 3,036,400 39,234,096<br />
Betting & Gaming<br />
- - - - -<br />
Levy<br />
Compounding Penalty 13,637,224 - 13,637,224 13,637,224 -<br />
Obsolete Taxes 4,644 - 4,644 4,644 -<br />
Social Responsibility<br />
Levy<br />
184,227 - 184,227 - 184,227<br />
158,826,063,186 42,944,761,036 115,881,302,150 66,238,174,004 49,643,128,146<br />
* Penalties <strong>of</strong> Metro Branches and Regional Offices have not been included.<br />
25
CHAPTER 5<br />
INTERNATIONAL RELATIONS<br />
5.1 Double Tax Treaties<br />
Tax Treaties eliminate or mitigate the incidence <strong>of</strong> juridical double taxation and the fiscal evasion,<br />
and are considered as vital in international tax matters. These Treaties are particularly important<br />
for developing countries as they play a great role in attracting foreign investments, expertise,<br />
modern technology etc.<br />
Sri Lanka has as at 31-12-<strong>2007</strong> entered into tax treaties with 37 countries as referred to in the<br />
following Table.<br />
Table - 20<br />
The countries with which tax treaties are in force as at 31-12-<strong>2007</strong><br />
Country<br />
Date <strong>of</strong><br />
Signing the<br />
Agreement<br />
Gazetted<br />
Gazette No.<br />
Date<br />
Operative in Sri<br />
Lanka From the<br />
Year <strong>of</strong><br />
Assessment<br />
1 Australia 18-Dec-1989 657/2 8-Apr-1991 1992/93<br />
2 Bangladesh 24-Jul-1986 448/13 7-Apr-1987 1989/90<br />
3 Belgium 3-Feb-1983 292/6 9-Apr-1984 1984/85<br />
4 Canada 23-Jun-1982 253/8 13-Jul-1983 1986/87<br />
5 China 11-Aug-2003 1374/20 6-Jan-2005 2006/07<br />
6 Denmark (Rev.) 22-Dec-1981 228/15 20-Jan-1983 1980/81<br />
7 France 17-Sep-1981 210/17 17-Sep-1982 1982/83<br />
8 Finland 18-May-1982 253/8 13-Jul-1983 1981/82<br />
9 Germany (Rev.) 13-Sep-1979 113 31-Oct-1980 1982/83<br />
10 Hong Kong (Limited) 26-Mar-2004 1374/21 6-Jan-2005 2005/06<br />
11 India (Rev.) 27-Jan-1982 210/17 17-Sep-1982 1980/81<br />
12 Indonesia 3-Feb-1993 789/10 21-Oct-1993 1995/96<br />
13 Iran 25-Jul-2000 1187/16 6-Jun-2001 2002/03<br />
14 Italy 28-Mar-1984 322/4 5-Nov-1984 1978/79<br />
15 Japan 12-Dec-1967 14803/5 29-May-1968 1969/70<br />
16 Korea 28-May-1984 342/11 29-Mar-1985 1980/81<br />
17 Kuwait 5-Feb-2002 1245/19 18-Jul-2002 2002/03<br />
18 Malaysia (Rev.) 16-Sep-1997 1028/21 22-May-1998 99/2000<br />
19 Mauritius 12-Mar-1996 958/10 15-Jan-1997 1998/99<br />
20 Nepal 6-Jul-1999 1116/6 26-Jan-2000 2001/02<br />
21 Netherlands 17-Nov-1982 281/13 26-Jan-1984 1979/80<br />
22 Norway (Rev.) 1-Dec-1986 464/4 27-Jul-1987 1989/90<br />
23 Oman (Limited) 26-Jul-1994 881/7 26-Jul-1995 1979/80<br />
24 Pakistan (Rev.) 15-Oct-1981 210/17 17-Sep-1982 1983/84<br />
25 Poland 25-Apr-1980 130 27-Feb-1981 1984/85<br />
26 Qatar 7-Nov-2004 1422/10 5-Dec-2005 2008/09<br />
27 Romania 19-Oct-1984 371/9 15-Oct-1985 1986/87<br />
28 Russia 2-Mar-1999 1101/22 15-Oct-1999 2003/04<br />
29 Saudi Arabia (Limited) 16-Dec-1999 1101/23 15-Oct-1999 1983/84<br />
30 Singapore 29-May-1979 57/11 10-Oct-1979 1977/78<br />
31 Sweden (Rev.) 23-Feb-1983 297/28 18-May-1984 1985/86<br />
32 Switzerland 11-Jan-1983 292/6 9-Apr-1984 1981/82<br />
33 Thailand 14-Dec-1988 571/16 18-Aug-1989 1990/91<br />
34 U.A.E. (Limited) 7-Jul-1992 824/13 23-Jun-1994 1979/80<br />
U.A.E. (Comprehensive) 24-Sep-2003 1346/1 21-Jun-2004 2004/05<br />
35 U.K. 21-Jun-1979 60/23 2-Nov-1979 1977/78<br />
36 U.S.A 14-Mar-1985 398/4 22-Apr-1986<br />
U.S.A. Protocol 20-Sep-2002 1298/8 21-Jul-2003 2004/05<br />
37 Vietnam 26-Oct-2005 1455/9 24-Jul-2006 <strong>2007</strong>/08<br />
27
Affairs related to tax treaties during the year <strong>2007</strong>-<br />
Agreement with Austria<br />
The first round <strong>of</strong> negotiations between Sri Lanka and Austria held in Vienna during the March, and the<br />
second round <strong>of</strong> negotiations in Colombo, during September <strong>2007</strong>, concluding the Officials’ level <strong>of</strong><br />
negotiations.<br />
Agreement with Qatar<br />
The agreement entered into force on May 03, <strong>2007</strong>. Accordingly, the agreement is applicable in Sri Lanka<br />
for the year <strong>of</strong> assessment 2008/09 onward.<br />
New Proposals-<br />
Proposals from Croatia, Ukraine, Saudi Arabia and Luxembourg were received during the year and<br />
preliminary studies on the importance <strong>of</strong> entering into such agreements with those countries were<br />
completed.<br />
5.2 Participations at International Taxation Matters Abroad<br />
Mr. A.A.Wijepala CGIR Negotiation on Double<br />
Austria 06-09 Mar. <strong>2007</strong><br />
Taxation Agreement<br />
Mr. H.B.A. Seneviratne CIR Negotiation on Double<br />
Austria 06-09 Mar. <strong>2007</strong><br />
Taxation Agreement<br />
Miss. DGPW Gunatillake DC Negotiation on Double<br />
Austria 06-09 Mar. <strong>2007</strong><br />
Taxation Agreement<br />
Mr. D U A Jayawardana SA Negotiation on Double<br />
Austria 06-09 Mar. <strong>2007</strong><br />
Taxation Agreement<br />
28
6.1 Legislation made during the year<br />
CHAPTER 6<br />
LEGISLATION<br />
i. <strong>Inland</strong> <strong>Revenue</strong> (Amendment) Act No. 10 <strong>of</strong> <strong>2007</strong>.<br />
ii. Value Added Tax (Amendment) Act No. 14 <strong>of</strong> <strong>2007</strong>.<br />
iii. Economic Service Charge (Amendment) Act No. 15 <strong>of</strong> <strong>2007</strong>.<br />
iv. Debits Tax (Amendment) Act No. 12 <strong>of</strong> <strong>2007</strong>.<br />
v. Finance Act No. 13 <strong>of</strong> <strong>2007</strong> to amend the law relating to the Motor Vehicle<br />
Concessionary Levy and Construction Industry Guarantee Fund Levy.<br />
vi.<br />
Finance Act No. 45 <strong>of</strong> <strong>2007</strong> to amend the law relating to the Social<br />
Responsibility Levy.<br />
6.2 Rulings Given During The Year<br />
Relevant<br />
Section <strong>of</strong> the Act<br />
Description<br />
Ruling Number<br />
Section 35(2) (IT Act No. 10<br />
<strong>of</strong> 2006)<br />
Section 76 (IT Act No. 10 <strong>of</strong><br />
2006)<br />
Section 102 (IT Act No. 10<br />
<strong>of</strong> 2006)<br />
Section 26(1)/ 25(1)(o) (IT<br />
Act No. 10 <strong>of</strong> 2006)<br />
Section 25 F (b) (VAT Act<br />
No.14 <strong>of</strong> 2002)<br />
First Schedule (VAT Act<br />
No.14 <strong>of</strong> 2002)<br />
Section 83 (VAT Act No.14<br />
<strong>of</strong> 2002)<br />
Section 2 (3)(b) (ESC Act<br />
No. 13 <strong>of</strong> 2006)<br />
Tax Payable on Compensation for loss <strong>of</strong> Rul /IT / <strong>2007</strong>/ 06<br />
<strong>of</strong>fice or employment<br />
Liability <strong>of</strong> a Co-ownership to Partnership Rul/ IT / <strong>2007</strong>/ 07<br />
Tax<br />
Definition <strong>of</strong> NGO Rul/ IT / <strong>2007</strong>/ 09<br />
Payment <strong>of</strong> Gratuity via a provision Rul/ IT / 2006/ 10<br />
account vis-à-vis A separate fund<br />
Falls under the Financial VAT or Normal Rul/ VAT/ <strong>2007</strong>/ 04<br />
VAT<br />
Exemption for Diplomatic Personnel Rul/ VAT/ <strong>2007</strong>/ 05<br />
Missions or Organizations<br />
Manufacture <strong>of</strong> CD-Rom Compact Disks Rul/ VAT/ <strong>2007</strong>/ 06<br />
for Educational Purposes<br />
Turnover Liable to ESC Rul/ ESC/ <strong>2007</strong>/ 06<br />
29
6.3 Approved Charities<br />
The following Institutions were declared as Approved Charities under Section 34(8) (a) <strong>of</strong><br />
the <strong>Inland</strong> <strong>Revenue</strong> Act. No. 10 <strong>of</strong> 2006.<br />
Name and address <strong>of</strong> the organization Gazette Number Date<br />
1) Fund for Caring Poor Children <strong>of</strong> 1505 06.07.<strong>2007</strong><br />
Arc-En-Ceil<br />
83, Sri Dhammadara Mawatha<br />
Ratmalana<br />
2) The Scholarship Fund for 1505 06.07.<strong>2007</strong><br />
Higher Education <strong>of</strong> the<br />
Commercial Bank Social<br />
Responsibility Trust<br />
21, Bristol Street<br />
Colombo 01<br />
3) Sirisangabo Special Children’s 1485 15.02.<strong>2007</strong><br />
Foundation<br />
Koongahawatta<br />
Kandy Road<br />
Pasyala<br />
4) Building Construction Fund 1530 28.12.<strong>2007</strong><br />
<strong>of</strong> the Homagama Base Hospital<br />
Bamunuarachchi Foundation<br />
52, Sir Marcus Fernando Mw,<br />
Colombo 07.<br />
5) Fund to provide Financial Aid to 1522 02.11.<strong>2007</strong><br />
Construct houses for the destitute<br />
<strong>of</strong> the International Social Service<br />
Organisation.<br />
30
CHAPTER 7<br />
AUDITS, ADDITIONAL TAX COLLECTIONS, RECOVERY ACTIONS AND APPEALS<br />
Audits and investigations are undertaken with a view to achieving the widest possible coverage <strong>of</strong><br />
the taxpayer population, in terms <strong>of</strong> business activity, entity type and business size. It has been,<br />
however, found that the most productive use <strong>of</strong> investigate resources has been in respect <strong>of</strong> the<br />
largest taxpayers. In the year under review the selection process focused heavily on this category<br />
resulting in a notable increase in back duty. Accordingly, audit functions were carried out in a<br />
satisfactory level resulting in collection <strong>of</strong> an additional tax amounting to Rs.6.6 billion, in the<br />
year.<br />
7.1 Particulars <strong>of</strong> Audits and Additional Tax Collection during the year. (Rs: Mn)<br />
Income<br />
Tax<br />
PAYE<br />
Value<br />
Added<br />
Tax<br />
ESC Others Total<br />
Total amount <strong>of</strong> additional tax<br />
assessed during the year 4,681 323 7,259 438 28 12,731<br />
Total amount <strong>of</strong> additional tax<br />
collected during the year 2,433 149 3,540 374 215 6,711<br />
Number <strong>of</strong> Audit cases commenced<br />
during the year <strong>2007</strong> 8,509<br />
Number <strong>of</strong> Audit cases finalized<br />
during the year <strong>2007</strong> 5,343<br />
7.2 Additional information on Additional Taxes<br />
Description<br />
Additional<br />
Income/Turnover<br />
Assessed &<br />
Agreed (Rs:)<br />
Corporate-<br />
LTU (Rs:)<br />
Additional Tax Assessed & Agreed (Rs :)<br />
Corporate-<br />
Other Units<br />
(Rs:)<br />
Non<br />
corporate<br />
Units (Rs:)<br />
Total (Rs:)<br />
Additional<br />
Tax Collected<br />
(Rs:)<br />
Income<br />
Tax 19,939,083,504 3,782,680,189 348,213,846 550,297,345 4,681,191,380 2,433,056,703<br />
VAT 30,614,166,630 5,712,646,592 1,461,652,157 85,542,455 7,259,841,204 3,540,329,268<br />
ESC 32,900,613,189 169,509,358 261,708,162 6,631,989 437,849,509 373,525,233<br />
PAYE 6,096,773,669 230,007,273 93,405,343 - 323,412,616 149,126,055<br />
Others 3,874,069,947 23,370,684 5,442,428 - 28,813,112 214,907,619<br />
Total 93,424,706,939 9,918,214,096 2,170,421,936 642,471,789 12,731,107,821 6,710,944,878<br />
31
7.3 Appeals<br />
Appeals to the Commissioner General<br />
Income Tax<br />
Value Added<br />
Tax<br />
Others<br />
Balance as CGIR (Hearing ) 76 125 111<br />
at Units 252 29 24<br />
01.01.<strong>2007</strong> Appeal Branch 58 05 03<br />
Registered (APL 2) during the year 617 688 225<br />
Determined ( CGIR) 22 79 69<br />
Finalized Units (APL 4) 373 289 127<br />
Appeal Branch 60 34 31<br />
Submitted for hearing (CGIR) 12 125 04<br />
Balance as CGIR (Hearing ) 66 171 46<br />
at Units 453 244 86<br />
31.12.<strong>2007</strong> Appeal Branch 29 30 04<br />
7.4 Board <strong>of</strong> Review<br />
The position as regards appeals made to the Board <strong>of</strong> Review was as follows:<br />
Number <strong>of</strong> appeals pending before the Board <strong>of</strong> Review as at 01-01-<strong>2007</strong> 105<br />
Number <strong>of</strong> appeals lodged during the year 26<br />
Number <strong>of</strong> orders issued on conclusion <strong>of</strong> hearing 14<br />
Number <strong>of</strong> appeals outstanding as at 31-12-<strong>2007</strong> 117<br />
The Board <strong>of</strong> Review took up 24 cases for hearing during the year, although only 14<br />
orders were issued on conclusion.<br />
Cases stated during the year for the opinion <strong>of</strong> the Court <strong>of</strong> Appeal- 08.<br />
32
CHAPTER 8<br />
TAX PAYER SERVICES<br />
Several Taxpayer service activities were organized in parallel to the 75 th anniversary <strong>of</strong> the<br />
<strong>Department</strong>. “Payment <strong>of</strong> Tax is Your Duty” campaign was launched to mark this event. The<br />
campaign strategy was developed on the premise that the payment <strong>of</strong> taxes is the voluntary<br />
responsibility <strong>of</strong> a good citizen that deserves the recognition and respect personalities representing<br />
various pr<strong>of</strong>essions, whose lucrative practices leave room for tax evasion was featured as spokes<br />
people who can set an example, by endorsing that “payment <strong>of</strong> tax is a duty and not an<br />
obligation”. The view that demonstrated was that the monies collected would be channeled for<br />
nation building which would benefited by the country and its citizens as a whole. The objectives<br />
<strong>of</strong> the campaign were to create a positive perception among the public towards the voluntary<br />
payment <strong>of</strong> taxes to the state, to communicate that payment <strong>of</strong> tax is a duty and not an obligation<br />
<strong>of</strong> all citizens and to emphasize the use <strong>of</strong> these funds would be used for greater development <strong>of</strong><br />
the country.<br />
“Rata Venuven Api” campaign was to emotionally motivate voluntary payment <strong>of</strong> taxes and to<br />
communicate how the people voluntarily pay their taxes becomes stakeholders <strong>of</strong> nation building<br />
process.<br />
“Badhu Nogeuvoth Amaruwe” campaign was some sort <strong>of</strong> different message to compel tax<br />
evaders to pay taxes. This was a parallel campaign depicting typical tax evaders who were under<br />
Tax <strong>Department</strong>’s scrutiny for tax evasion, a subtle warning to evaders to switch on to voluntary<br />
tax payment and necessary communication in support <strong>of</strong> getting the hardcore evaders in to tax<br />
net.<br />
To achieve the objectives <strong>of</strong> the campaign the following communication vehicles were used.<br />
‣ Press<br />
Advertisements were published in Sinhala, Tamil and English in daily and weekend<br />
newspapers for 2 months from the end <strong>of</strong> March <strong>2007</strong>.<br />
‣ Television Advertisements<br />
Telecast <strong>of</strong> an attractive commercial running for 30 seconds in Sinhala, Tamil and English<br />
on nine television channels, was received good responses<br />
‣ Hoardings<br />
Four hoardings were fixed at Colombo-Katunayake road, Parliament road, Nugegoda and<br />
Pettah.<br />
‣ Posters<br />
10,000 posters (<strong>of</strong> 4 different pictures) were displayed at selected institutions.<br />
‣ Brochures<br />
90,000 brochures were distributed among people by conducting an “<strong>Inland</strong> <strong>Revenue</strong><br />
Walk”<br />
33
Introduction <strong>of</strong> certain tax benefits to individual taxpayers is a special feature witnessed by the tax<br />
system <strong>of</strong> Sri Lanka in the recent past. The main objectives <strong>of</strong> these tax benefits are to enhance<br />
the voluntary compliance towards the tax laws.<br />
The process <strong>of</strong> issuing privilege cards to compliant (individual) taxpayers to recognize their<br />
contribution (to the Government <strong>Revenue</strong>) and to make them entitled to certain moral benefits<br />
such as preferential treatments at the Government Agencies, continued with added modes. The<br />
primary objective <strong>of</strong> issuing privilege cards is to give certain recognition to those taxpayers who<br />
show optimum compliance on tax laws. During the year 252 Gold cards and 132 Silver cards were<br />
issued accordingly.<br />
The Taxpayer Service Unit housed on the ground floor <strong>of</strong> the <strong>Inland</strong> <strong>Revenue</strong> Building has been<br />
equipped with facilities for the sake <strong>of</strong> tax payers and the public to access conveniently. The unit<br />
is equipped with <strong>of</strong>ficers to assist every person seeking help or information. Relevant enactments,<br />
departmental publications, paying-in slip, forms etc. are available in this unit. During the year<br />
issuing 10,458 Temporary Identification Numbers, 2,437 Income Tax registrations, 2,819 VAT<br />
registrations and 1,735 PAYE registrations have been made during the year <strong>2007</strong>. The temporary<br />
VAT certificates issued during the year <strong>2007</strong> were 14,279.<br />
34
Annexure I<br />
Specialized Training Programme on Audit & Investigation, International Taxation<br />
& Management at the National Academy <strong>of</strong> Direct Taxes (NADT) <strong>of</strong> India.<br />
From 15th - 26th Oct. <strong>2007</strong> -<br />
From 12th - 23rd Nov. <strong>2007</strong> - Mumbai From 3rd - 14th Dec. <strong>2007</strong> - Nagpur<br />
Nagpur<br />
Name Designation Name Designation Name Designation<br />
1 Mrs. D.M. Nandawathie Commissioner 1 Mrs. L. Ramanayake Commissioner 1 Mrs. M. Samarasekera Commissioner<br />
2 Mr. H.M. Abeysinghe Commissioner 2 Mr. W.M.W. Kumarasiri Commissioner 2 Mr. K.L.S. Silva Commissioner<br />
3 Mr. P.D. Premarathne Commissioner 3 Mr. A.L.A. Sirisena Commissioner 3 Mr. H.B.A. Seneviratne Commissioner<br />
4 Mr. S.T. Gobalasingham Commissioner 4 Mrs. H.M.C.I. Gunasekera Commissioner 4 Mr. H.M. Premaratna Banda Commissioner<br />
5 Mr. K.A.P. Kaluarachchi Commissioner 5 Mr. S. Rajapakshe Dy. Commissioner 5 Miss D.G.P.W. Gunathilake Dy. Commissioner<br />
6 Mrs. W.B.S. Shanthikumar Commissioner 6 Mr. A.A.D.U. Abeysinghe Dy. Commissioner 6 Mrs. C.H. Weerasinghe Dy. Commissioner<br />
7 Mr. P.A.V. Premaratne Dy. Commissioner 7 Ms. H.M.D. Munasinghe Dy. Commissioner 7 Mrs. K.M.S. Jayaweera Dy. Commissioner<br />
8 Mrs. K. Dahanayake Dy. Commissioner 8 Mrs. K.D.M.R. Silva Dy. Commissioner 8 Mr. H.M.G. Wijesinghe Dy. Commissioner<br />
9 Mr. K.A.G. Abayaratne Dy. Commissioner 9 Mrs. S.N.P. Abrew Dy. Commissioner 9 Mr. W.S.K. De Costa Dy. Commissioner<br />
10 Mr. D.B. Jayasekera Dy. Commissioner 10 Mrs. K.S.B.R.D.S. Karunaratne Dy. Commissioner 10 Mr. M.S.M. Fuward Dy. Commissioner<br />
11 Mrs. W. Anulawathie Dy. Commissioner 11 Mr. K.G. Piyatissa Dy. Commissioner 11 Mr. A.A. Dayaratne Dy. Commissioner<br />
12 Mrs. S. Edirisinghe Dy. Commissioner 12 Mr. O.P.P.K. Sirisena Dy. Commissioner 12 Mr. J. Ratnayake Dy. Commissioner<br />
13 Mr. I.M.B. Seneviratne Banda Dy. Commissioner 13 Mr. K. Dharmasena Dy. Commissioner 13 Mrs. Vijitha Paranamana Dy. Commissioner<br />
14 Mr. J.M. Jayawardena Dy. Commissioner 14 Mrs. B.A.D.D. Herath Dy. Commissioner 14 Mr. E.S. De Zoysa Dy. Commissioner<br />
15 Mr. S.A. Hemapala Dy. Commissioner 15 Mr. D.B. Dissanayake Dy. Commissioner 15 Mr. D.R.S. Hapuarachchi Dy. Commissioner<br />
16 Mr. K. Rajaratnam Dy. Commissioner 16 Mr. K.D.N.P. Koralearachchi Dy. Commissioner 16 Mrs. D.M. P. Ganepola Dy. Commissioner<br />
17 Mr. A. Sri Selvanayagam Dy. Commissioner 17 Mr. T.M. Dayananda Dy. Commissioner 17 Mr. R.S. Samaranayake Dy. Commissioner<br />
18 Mrs. R.M.R.W. Manchanayake Dy. Commissioner 18 Mr. P.M. Dissanayake Dy. Commissioner 18 Mr. G.C. Mahanama Dy. Commissioner<br />
19 Mr. D.M.L.I. Dissanayake Dy. Commissioner 19 Mr. B.G. Piyadasa Dy. Commissioner 19 Mr. K.D.M.N. Gunathunga Dy. Commissioner<br />
20 Mr. A. N. Guruge Dy. Commissioner 20 Mr. M.J. Gunasiri Dy. Commissioner 20 Mr. H.W. G. Pushpakumara Dy. Commissioner<br />
21 Mrs. P.Rohini Dy. Commissioner 21 Mr. H.M.W.C. Bandara Dy. Commissioner 21 Mrs. P. Hewage Dy. Commissioner<br />
22 Mrs. R.M.P.S.K. Rajapakse Dy. Commissioner 22 Mr. R.G. Dharmadasa Dy. Commissioner 22 Mr. S.S.D. Weerasekera Dy. Commissioner<br />
23 Mr. J.P.D.R. Jayasekera Dy. Commissioner 23 Mr. R.M. Jayasinghe Dy. Commissioner 23 Mr. T. Rajapakse Dy. Commissioner<br />
24 Mr. D.M.S. Dissanayake Dy. Commissioner 24 Mr. M.H. Densil Dy. Commissioner 24 Mr. B. Sivaji Dy. Commissioner<br />
25 Mr. M.G. Somachandra Dy. Commissioner 25 Mr. U.B. Wakkumbura Dy. Commissioner 25 Mr. M.S.M. Siyan Dy. Commissioner<br />
26 Mr. P.G.K. Samaratunga Dy. Commissioner 26 Mr. B.J. Jayaratne Dy. Commissioner 26 Mr. U.P.S.A. Jayalath Dy. Commissioner<br />
27 Mr. K.H.N.C. Perera Dy. Commissioner 27 Mr. M.L. Mohomad Thahir Dy. Commissioner 27 Mr. J.A.D. Sepala Dy. Commissioner<br />
28 Mr. P.L.A. Liyanage Dy. Commissioner 28 Mr. K.D.M. Ratnakumara Dy. Commissioner 28 Mrs. T.G.D.S. Jayawardane Dy. Commissioner<br />
29 Mr. J.A.A. Parakrama Dy. Commissioner 29 Mr. M.D.J.M. Devapriya Dy. Commissioner 29 Mr. T. Karunadasa Dy. Commissioner<br />
30 Mr. A.G. Sumanadasa Dy. Commissioner<br />
35<br />
35
DISTRIBUTION OF STAFF, FILES AND REVENUE AMONG THE ASSESSING DIVISIONS<br />
37<br />
Annexure II<br />
Assessing Divisions Staff Files<br />
37<br />
<strong>Revenue</strong> (RS. Mn)<br />
DC SA A STO TO Others Total IT B&G.L. D.T. PAYE ESC VAT IT & SRL TT DT SD ESC VAT &GST STL B&G Total<br />
International Unit 1 1 2 0 2 1 7 673 45 25 51 1,464 26 385 1,875<br />
Unit 1& 2 2 0 9 2 11 7 31 4,459 9 379 3 382<br />
Unit 3<br />
2<br />
8 48 18,579 159 159<br />
Unit 4<br />
2 1 21<br />
1<br />
14<br />
7 42 4,368 2,077 1,098 2,688 1,214<br />
533 2,487 4,242<br />
Unit 5<br />
2 1 18<br />
2<br />
13<br />
6 43 6,639 3,984 1,213 3,713 1,482<br />
8<br />
577 3,248 5,311<br />
Unit 6A<br />
2 2 18<br />
4<br />
13<br />
6 38 239 291 230 233 5,772<br />
4<br />
1,378 15,051 22,206<br />
Unit 6B<br />
2 1 12<br />
3<br />
13<br />
5 34 242 272 224 228 3,805<br />
5<br />
1,123 7,331 12,266<br />
Unit 6C<br />
2 1 10<br />
2<br />
13<br />
6 34 72 204 67 272 15,027<br />
7<br />
1,553 18,603 35,184<br />
Unit 7A<br />
1 1 11<br />
2<br />
13<br />
5 27 203 259 195 201 4,082<br />
1<br />
1,086 3,941 9,116<br />
Unit 7B<br />
2 1 9<br />
2<br />
8<br />
23 234 305 218 228 4,952<br />
7<br />
1,148 9,400 15,501<br />
Unit 8<br />
1 1 10<br />
6<br />
9<br />
6 30 238 287 231 239 13,625<br />
1<br />
1,306 12,277 27,264<br />
Unit 10<br />
2 2 9<br />
4<br />
5<br />
5 40 1,235 989 813 1,094 2,757<br />
56<br />
1,341 7,461 11,565<br />
Unit 12<br />
1 6 12<br />
5<br />
12<br />
5 40 7,110 3,287 961 3,951 1,370<br />
6<br />
590 3,173 5,138<br />
Unit 14<br />
2 1 14<br />
1<br />
13<br />
5 30 1,869 648 391 876 193<br />
5<br />
208 732 1,134<br />
Unit 15<br />
2 1 10<br />
1<br />
11<br />
4 28 1,944 588 425 1,014 426<br />
1<br />
276 1,230 1,932<br />
WHT on Specified Fees<br />
2 1 10<br />
3<br />
10<br />
9 43 9,965<br />
0<br />
9,965<br />
WHT on Interest<br />
1 1<br />
0<br />
15<br />
9 0<br />
14<br />
3 23 25,052 25,052<br />
PAYE<br />
1<br />
2<br />
10<br />
6 23 239 1,690 412 2,102<br />
Betting & Gaming Levy<br />
1 2<br />
0<br />
6<br />
5 0<br />
6<br />
3 13 766<br />
268 418<br />
Debit Tax<br />
1<br />
4<br />
- 854<br />
150<br />
7,187 7,187<br />
Value Added Tax<br />
GST<br />
Stamp Duty<br />
Regional Offices<br />
Colombo South<br />
4 3<br />
0<br />
27<br />
1<br />
0<br />
6<br />
2<br />
11<br />
3<br />
1<br />
3<br />
22<br />
3<br />
6<br />
12 71 14,749 5,883 5,883<br />
2 13 141 141<br />
7 29 3,182 3,182<br />
1<br />
7 42 10,675 179 379 70 449<br />
Colombo Central<br />
1 2 18<br />
2<br />
13<br />
10 47 15,130 372 306 166 472<br />
Colombo City<br />
1 1 22<br />
3<br />
11<br />
10 49 9,733 341 300 184 484<br />
Maharagama East<br />
1 5 16<br />
4<br />
14<br />
6 46 15,431 5 176 94 47 141<br />
Maharagama West<br />
1 1 24<br />
4<br />
10<br />
6 39 11,046 149 125 38 0 163<br />
Badulla<br />
1 1 19<br />
5<br />
8<br />
9 33 4,828 45 57 13 70<br />
Galle<br />
1 1 10<br />
6<br />
7<br />
14 38 5,752 20 170 79 56 135<br />
Kalutara<br />
1 1 12<br />
4<br />
4<br />
15 45 6,003 46 113 61 33 94<br />
Gampaha<br />
1 1 16<br />
12<br />
8<br />
5 41 12,554 170 132 62 194<br />
Matara<br />
1 1<br />
-<br />
20<br />
6<br />
2<br />
14 51 7,711 13 184 107 45 4 156<br />
Nuwara Eliya<br />
1<br />
24<br />
2<br />
6<br />
12 30 4,017 57 56 22 78<br />
Ratnapura<br />
1<br />
0<br />
1 9<br />
5<br />
5<br />
12 39 7,112 32 120 94 62 0 156<br />
Anuradhapura<br />
1 11<br />
3<br />
10<br />
13 41 5,777 90 77<br />
23 1 205<br />
Batticaloa<br />
1<br />
0<br />
1<br />
0<br />
12<br />
5<br />
11<br />
10 25 2,499 2 78 17<br />
104<br />
13 217<br />
Jaffna 0 0<br />
4<br />
0<br />
6<br />
0 5 6 3,722 21 4<br />
187<br />
0 28<br />
Kandy 1<br />
1<br />
10<br />
14 59 9,784 140 235<br />
24<br />
44 2 281<br />
Kegalle 1<br />
2 20<br />
5<br />
12<br />
11 36 4,247 6 108 42 12 1 55<br />
Kurunagala 1<br />
1 11<br />
5<br />
7<br />
16 55 8,471 58 51 193 29 222<br />
Matale 1<br />
1 19<br />
5<br />
13<br />
6 33 2,995 19 54 62 17 0 79<br />
Negombo<br />
1<br />
0<br />
11<br />
6<br />
9<br />
12 47 10,002 192 128 58 186<br />
1<br />
19<br />
9<br />
Total<br />
142<br />
324 1,505 205,832 967 854 13,236 8,910 29,537 95,962<br />
7,187 3,182 12,142 91,352 412 268 211,071<br />
53 48 550<br />
388<br />
566<br />
VAT on Imports 101,501<br />
Other Taxes (NSL,Other SRL etc.) 262<br />
Treasury Transfers 4,588<br />
sums credited by Accounts Branch 1,021<br />
318,443<br />
Less- Refunds (10,238)<br />
al Net Collection 308,205