In response to the controversy that erupted after the Committee on Public Enterprises (COPE) revealed that the Ceylon Electricity Board (CEB) has utilised nearly Rs 5 billion in public funds to pay Pay As You Earn Tax (PAYE) and Advanced Personal Income Tax (APIT)of its employees, from 2010 to 2020, the CEB said approximately 20 State institutions have followed the same practice, including the Central Bank of Sri Lanka (CBSL).
CEB said the PAYE Tax is currently being paid by all employees at personal level to the Inland Revenue Department. In a statement, CEB said a total of 36 allowances are paid, 28 of which have been accepted by the Cabinet and eight by the Board. All of the allowances offered by the CEB are less than 10 per cent of the entire income of the institute, the CEB said. PAYE tax was paid in accordance with the collective agreement negotiated by management and trade unions, benefits were extended to all employees at the CEB, including engineers, accountants, and human resources officers.
The collective agreement was also Gazetted and authorised by the Cabinet by the Commissioner of Labour. Similarly, in the event of salary revisions every three years, the salary rise took into account the PAYE Tax. However, with the implementation of the Advance Personal Income Tax (APIT), the Ceylon Electricity Board’s payment of PAYE Tax was abolished around 2020 and is currently paid by all employees at personal level to the Inland Revenue Department, the statement said. Moreover, because of the non-increase in power tariffs after 2014, the CEB’s expenditure has increased comparatively to its revenue. The CEB is incurring losses because it is committed to serve the nation despite the amount of its revenue, the statement added.
By Thameenah Razeek