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COPF Approves Reduction of CESS on Cement

The Committee on Public Finance (COPF) has approved a reduction in the existing CESS tax on cement, resulting in a price decrease of approximately Rs. 100 per bag of cement.

Key decisions made during the meeting include:

• The COPF Chair has instructed officials to take necessary steps to ensure that the income generated from the CESS tax is directly transferred to the relevant financial institutions.

• The Committee approved an increase in the benefits provided to Aswesuma program beneficiaries.

The order presented by officials from the Ministry of Finance to reduce the CESS tax on cement was approved by the Committee on Public Finance. As a result, the price of a kilogram of cement will decrease by Rs. 1, leading to a reduction of approximately Rs. 100 per bag, according to Ministry officials.

These matters were discussed during a meeting of the Committee on Public Finance held in Parliament on 8 January, chaired by Dr. Harsha de Silva.

The Committee considered various Orders and Notifications, including:
• Order under Section 14 of the Sri Lanka Export Development Act, No. 40 of 1979 (Gazette Extraordinary No. 2400/25)
• Notification under Section 3(4) of the Strategic Development Projects Act, No. 14 of 2008 (Gazette Extraordinary No. 2399/16)
• Order under Section 3(4) of the Strategic Development Projects Act, No. 14 of 2008 (Gazette Extraordinary No. 2401/19)
• Six Gazette Notifications published under the Special Commodity Levy Act, No. 48 of 2007
• Notification under the Welfare Benefits Act, No. 24 of 2002 (Gazette Extraordinary No. 2415/66)

In line with the Order under the Sri Lanka Export Development Act, the COPF Chair instructed Ministry of Finance officials to take the necessary steps to ensure that the revenue generated through the CESS tax, imposed for export development, is directly transferred to the relevant financial institutions.

Additionally, the Committee approved a reduction in the tax imposed on the export of rock boulders, a measure introduced during the construction of the Hambantota Port. The new tax will be Rs. 1,000 per cubic meter for the export of one million metric tons of rock boulders.

Regarding the Welfare Benefits Act, the Committee approved an increase in benefits for Aswesuma program beneficiaries. The allowance for households under extreme poverty will rise from Rs. 15,000 to Rs. 17,500. Households currently receiving Rs. 8,500 will see an increase to Rs. 10,000, while those receiving Rs. 2,500 will receive Rs. 5,000. The Rs. 5,000 allowance for certain households will remain unchanged.

The Committee did not approve the Notification under Section 3(4) of the Strategic Development Projects Act, No. 14 of 2008, pertaining to the Western Terminal of Colombo Port. However, the Order under Section 3(4) regarding a garment factory to be built in Batticaloa will be reconsidered at a later date.

Furthermore, the Committee reviewed six Orders under the Special Commodity Levy Act, No. 48 of 2007, pertaining to the extension of validity periods and tax reductions.

The meeting was attended by COPF members Ravi Karunanayake, Harshana Rajakaruna, Shanakiyan Rasamanickam, Dr. Kaushalya Ariyarathne, Nimal Palihena, Wijesiri Basnayake, Thilina Samarakoon, and Lakmali Hemachandra.

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