Many concessions to Sri Lanka's SME sector in 2013 budget

Sri Lanka's small and medium scale entrepreneurs have received many concessions from the 2013 Budget proposals, the Ceylon Chamber of Commerce (CCC) says. The President of the Chamber Asoka Hettigoda participating in a discussion programme of the state-run radio SLBC said the next year's Budget has exempted the small and medium enterprises (SMEs) from all taxes. President Mahinda Rajapaksa, who prepares the budget in his capacity as the Minister of Finance and Planning has proposed removing several taxes affecting business development among small and medium scale entrepreneurs. Hettigoda said additional tax concessions have been given for research on new products in the new budget recognizing that the development of a country rests with introduction of new products. He noted that there are several institutions providing small and medium scale industrialists the required knowledge, technology as well as financial support. According to the Hettigoda, the President held discussions with various sectors before formulating the Budget and incorporated their suggestions. The President in his budget speech on November 8 said the during Budget consultations with a cross section of people in the SME sector, a request was made for simpler systems and procedures when dealing with government agencies. Accordingly, the President has proposed exempting the SMEs with an annual turnover less than Rs. 12 million from Nation Building Tax (NBT) and Value Added Tax (VAT) for them to operate in a completely tax free environment. He proposed the applicable annual turnover for taxation be raised to Rs. 500 million, to allow SMEs to benefit from the low tax rate of 10 percent. The 2013 budget has also provided tax concessions to Sri Lankans who return from foreign employment and invests their savings to commence new businesses in the country. They will be exempt from all taxes payable on turnover and on the profits and income from all such new businesses for a period of 5 years. The CCC earlier in a statement said it is encouraged by the commitment to fiscal discipline displayed in Budget 2013 and the commitment to maintain a flexible exchange rate regime and the investment and growth targets outlined by the authorities. -->