Government faces dilemma in raising budget 2022 taxes

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These proposals have given a wrong signal to businesses while discouraging them from making their contributions to the economy, he added.

The present government has had to borrow a massive amount of money during the 3-year period ending 2022 which is more than the total borrowings of all the previous regimes during the 60 years since 1950, official statistics revealed.

The total public borrowings of previous governments during the period of 1950 to 2010 was in the region of Rs. 4.59 trillion, the computing of data included in the 2020 annual report of the Central Bank and budget speeches in 2021 and 2022 indicated.

According to the estimated expenditure contained in the Appropriation Bill the total expenditure was Rs. 5.13 trillion, of which the expenditure on public debt repayment was Rs. 1.52 trillion.

Secretary to the Treasury and Ministry of Finance S.R Attygalle, recently explained to the Parliamentary Committee on Recurrent Expenditure in the Bill that this mainly consists of Rs. 980.2 billion for the payment of salaries of public servants.

He further stated that Rs. 1 trillion for payment of government loan interest, Rs. 310 billion for pensions and welfare payments of disabled war heroes, Rs. 68 billion for medical supplies, Rs. 50 billion for Samurdhi subsidy and Rs. 35 billion for fertilizer and Rs. 69 billion for other subsidies have been allocated.

The million dollar question is as to how the government is going to find money to settle all those expenditure, several economic experts said adding that most of the revenue proposals in the budget were unrealistic.