Public servants' salaries:

Taxation ruled out

Shirley Wijesinghe

Inland Revenue Commissioner General Mahinda Madagoda rejected media reports that public servants' salaries would be taxed.

He said that taxation of cash rewards paid for certain categories of employees was a usual practice, on a quarterly basis. He was speaking at a media conference at the Government Information Department, Colombo.

Commenting on the delay in the refund of VAT payments, Madagoda said a special unit is now in operation to expedite the process. He said the department's Jaffna branch will be fully functional soon and all arrangements had been made to ensure transparency in tax-related issues in the northern region.

He called upon the tax payers in the North to follow normal procedures to pay taxes and they could do so voluntarily.

These measures have been taken to increase revenue in the next two to three years, he stressed.

The department had collected around Rs. 40 million as tax from the North during the past two years.

Any individual or an institution is now free to remit tax payments through any branch of Bank of Ceylon. In Colombo district, such payments can be made through any branch of People's Bank too, Madagoda said.

The Department is expected to commence its full operations by March next year when the reconstruction of the building is completed. No documents or files have been destroyed in the LTTE attack early this year, he added.