Centre for Policy Alternatives on 26 July, 2021

Centre for Policy Alternatives Files Petition in the Supreme Court (SC SD 28/2021) against proposed Finance Bill

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On the 26th July 2021, The Centre for Policy Alternatives (CPA) and its Executive Director, Dr. Paikiasothy Saravanamuttu filed a Petition in the Supreme Court (SC SD 28/2021) challenging the proposed Finance Bill, which was placed on the order paper of Parliament on the 20th of July 2021. The Bill seeks to provide an amnesty from tax, penalty or interest, or from any investigation or prosecution, to anyone who has not disclosed any taxable supply, income or asset which was required to be disclosed by law, provided that they invest an equivalent amount in the manner specified in the Bill.

CPA’s position is that several clauses in the Bill are inconsistent with the Constitution, including several entrench provisions, and thus cannot be passed into law except if approved by the people at a referendum in addition to a two-thirds vote of the whole number of the Members of Parliament in favour as required by Article 83(a) of the Constitution. 

CPA challenged clauses 2, 3, 4, 5 and 6 of the Bill on the basis that they are inconsistent with Articles 12(1), 4(d), 14(1)(g) read with Article 3 of the Constitution, as inter alia they legitimize fraud and are discriminatory towards those who have already disclosed and paid their taxes in accordance with the law. CPA also challenged clauses 10, 11 and 17 on similar grounds. CPA further challenged clause 7 of the Bill, which guarantees secrecy regarding the identity of such declarants, which is in violation of Articles 12(1), 14A, 4(d) read with Article 3 of the Constitution. 

CPA notes with concern that if passed, the Bill will result in impunity to those involved in corruption and fraud on the State and the populace as a whole. Further, the lack of transparency is inconsistent with the principles of good governance, especially in an era where the Right to Information has been expressly recognized by the Constitution and guaranteed to the people.