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CSE a casino as tax exemption fails to uplift SME sector
Private sector abuses tax concessions
November 7, 2011, 7:56 pm
Sri Lanka ought to slap a tax on capital gains arising from share transactions because the Colombo Stock Exchange (CSE) was more of a casino and has so far failed to live up to expectations; failing to uplift the SME sector.
A senior accountant, Ranel Wijesinha, who was instrumental in drafting a bill to exempt share transactions from a capital gains tax, said the intension of the bill he had "co-fathered" was to incentivise private equity companies and encourage small and medium enterprises (SMEs) to raise capital in the Colombo Stock Exchange.
"We worked hard to draft the bill and get it through. This was at a time interest rates were over 19 percent and it was hard for SMEs to raise capital. Our draft was rejected four times before it was even considered. We wanted to develop the stock exchange not merely by increasing the number of shares. We wanted to incentivise private equity companies and make the stock exchange a place where SMEs could raise capital. The capital gains tax exemption bill was formulated with this in mind," Wijesinha told a two day conference on taxation and development organised by the Institute of Policy Studies last week.
After having laboured relentlessly to bring in the capital gains tax exemption for share transactions, Wijesinha today believes it had not brought in the desired result.
"I am convinced the concession should not remain. It should be rationalised. Yes, the government recently introduced a transaction levy, but I am not convinced the country has gained from the capital gains tax exemption. The purpose was to enhance the SME sector, the tax exemption was not supposed to turn the stock exchange into a casino," Wijesinha, a Fellow of the Institute of Chartered Accountants and also one of its past presidents, said.
He has a Masters Degree in Business Administration from the University of Pittsburgh, Pennsylvania, USA and held top positions in both the private sector and public sector, including in the directorate of conglomerate John Keells Holdings and a member of the Sri Lanka Accounting and Auditing Standards Monitoring Board.
"I would rather incentives large projects and remove the exemption on capital gains," Wijesinha stressed.
"New incentives should be created while the existing ones need to be withdrawn or reallocated. The private sector abuses tax concessions," he said.
http://www.island.lk/index.php?page_cat=article-details&page=article-details&code_title=38579
Private sector abuses tax concessions
November 7, 2011, 7:56 pm
Sri Lanka ought to slap a tax on capital gains arising from share transactions because the Colombo Stock Exchange (CSE) was more of a casino and has so far failed to live up to expectations; failing to uplift the SME sector.
A senior accountant, Ranel Wijesinha, who was instrumental in drafting a bill to exempt share transactions from a capital gains tax, said the intension of the bill he had "co-fathered" was to incentivise private equity companies and encourage small and medium enterprises (SMEs) to raise capital in the Colombo Stock Exchange.
"We worked hard to draft the bill and get it through. This was at a time interest rates were over 19 percent and it was hard for SMEs to raise capital. Our draft was rejected four times before it was even considered. We wanted to develop the stock exchange not merely by increasing the number of shares. We wanted to incentivise private equity companies and make the stock exchange a place where SMEs could raise capital. The capital gains tax exemption bill was formulated with this in mind," Wijesinha told a two day conference on taxation and development organised by the Institute of Policy Studies last week.
After having laboured relentlessly to bring in the capital gains tax exemption for share transactions, Wijesinha today believes it had not brought in the desired result.
"I am convinced the concession should not remain. It should be rationalised. Yes, the government recently introduced a transaction levy, but I am not convinced the country has gained from the capital gains tax exemption. The purpose was to enhance the SME sector, the tax exemption was not supposed to turn the stock exchange into a casino," Wijesinha, a Fellow of the Institute of Chartered Accountants and also one of its past presidents, said.
He has a Masters Degree in Business Administration from the University of Pittsburgh, Pennsylvania, USA and held top positions in both the private sector and public sector, including in the directorate of conglomerate John Keells Holdings and a member of the Sri Lanka Accounting and Auditing Standards Monitoring Board.
"I would rather incentives large projects and remove the exemption on capital gains," Wijesinha stressed.
"New incentives should be created while the existing ones need to be withdrawn or reallocated. The private sector abuses tax concessions," he said.
http://www.island.lk/index.php?page_cat=article-details&page=article-details&code_title=38579
:Deleted: ...One SET OF IDIOTS 
DID Awesome thing to BRING DOWN THE Market 
....Is HE EDUCATED...SO HE IS A Educated IDIOT 
....THIS IS NOT A GOOD THING FOR THE MARKET. 
...DONT ANY OF THESE PEOPLE HAVE A COMMON SENSE.... 
