The Sri Lanka budget 2012 will focus on bringing down the import related expenses and generating more revenue through exports.
Sri Lanka Budget 2012 – Highlights and Possible Impact:
As per the 2012 Sri Lanka budget presented by Mahinda Rajapaksa, the President, the currency is expected to be devalued by 3 percent.
The value of the Sri Lankan Rupee has increased recently but the currencies of its trading partners have fallen at the same time.
No elections have been scheduled for the 2012 fiscal.
The government has proposed that a high cess be imposed on import of critical products such as rice, ginger, green grams, corn and peanuts. This will help Sri Lanka achieve some much-needed food security.
The fees applicable for registering vehicles will be changed in 2012. The charges for luxury cars will be increased though. This is expected to help the provincial councils generate more funds.
In 2012, the duties paid for importing tourism vehicles will be brought down by 50 percent.
30 billion Sri Lankan Rupees or approximately 271.8 billion dollars have been allotted for the network of roads that connect the various provinces.
Rajapaksa has proposed that 500 million Sri Lankan Rupees be provided for developing sporting infrastructure across the country. During the same period sports goods will be exempted from taxes so as to promote sports. All these measures, the government hopes, will make Sri Lanka a sports hub in the Southeast Asian region.
In 2012 the government will charge a visa fee of 20 US dollars for visitors who are not from SAARC countries. For visitors from SAARC s member countries, this rate will come down to $10. Children will not be subject to these charges, in an effort to promote tourism. Tourists who stay for more than 48 hours will be free from the charges as well. It is estimated that this visa fee will help Sri Lanka earn extra revenue of 2 billion Sri Lankan Rupees.
The defense sector has been allocated 230 billion Sri Lankan Rupees. 88% of this amount, or 203 billion, will be used for paying the salaries or buying the uniforms and food of the army men.
The state sector workers will see a 10 percent increase in their salaries in the upcoming fiscal. This will also include the soldiers of Sri Lanka.
The government has decided that in 2012 fiscal it will not sell any more public land to the private sector it will only agree to long term lease of such property. This decision has been taken keeping in mind the limited land held by the government. The government has also stated that if a private investor is found violating the agreement strict action will be taken against that individual or organization.
The government has found that 37,000 acres are not being used by the various plantations operating in Sri Lanka, in spite of owning them. This land will be taken away from them and then provided to some families, which have been identified as well, on lease for a 30-year period. Each family will receive 2 acres and this will help develop small estates. The families will also be provided with seeds and financial assistance.