John Keells Holdings Chairman Krishan Balendra speaking at the economic Summit 2022 emphasized the need to maintain consistent policies on the tax front.
Speaking on tax hikes, he said it will have immediate implications on cash flow and profitability as far as businesses are concerned. Balendra stated when VAT was introduced on the retail front one time, compelling them to make price adjustments; it had a significant impact on margins of their retail business as well as on consumers’ buying patterns.
“Despite price adjustments, we saw the market and margins recover within a short span of time. “We don’t mind higher taxes, but we need a guarantee to make sure tax revisions stay there for some period without any volatile, sharp ups and downs in the tax regime.”
Given the current recovery signs of the inflation path, Balendra is quite optimistic that Sri Lanka is gradually getting back to normalcy.
“We’re fairly confident that we should see an economic recovery.”
When asked about John Keells investments in Sri Lanka, Balendra said the company has made significant investments in Sri Lanka over the last five years and it is really about seeing the fruits of those investments over the next couple of years
“We’ve to be prudent as we would neither double down nor take chips off the table.”
Speaking on the tourism front at John Keells, Balendra said the current financial scenario in the country is forcing people especially in the tourism sector to migrate to countries such as Scotland, Ireland and Australia.
Meanwhile, raising concerns over the challenges faced by the banking sector in the face of current economic crisis in the country, Standard Chartered Bank- Chief Executive Officer, Bingumal Thewarathanthri said banking sector is not ready to take a domestic debt restructuring in particular a haircut at this point as it might have serious implications on entire sector.
Speaking further, Thewarathanthri said the overall banking sector is working together to redress key bottlenecks in particular liquidity situation of banks, extended moratorium facility given to tourism sector, rising non- performing loans that hamper the growth of the industry to a great extent. (IH)