Colombo: Sri Lanka’s newly appointed interim cabinet has announced wide ranging tax reliefs including reductions in Value Added Tax (VAT) and telecommunications levies, local media reported Wednesday.
Following the first meeting of a newly appointed interim cabinet, cabinet spokespersons Bandula Gunawardene and Ramesh Pathirana announced that Sri Lanka’s VAT would be reduced from 15 per cent to 8 per cent starting December 1, while a telecommunications levy will be reduced from 30 per cent to 5 per cent, Xinhua news agency reported.
Taxes on the construction industry have been reduced from 28 per cent to 14 per cent in a bid to boost growth in the sector.
Further tax reliefs announced included removals of the Capital Gains Tax on stock market activity, Nation Building Tax on goods and services, Withholding Tax on interests, Debit Tax on banks and financial institutions, and Pay As You Earn Tax deduction on income.
Taxes on remittances made by migrant workers and on religious places of worship will also be removed.
Wide ranging tax reliefs were key promises in President Gotabaya Rajapaksa’s election manifesto. The manifesto also pledged to amend the Inland Revenue Act in order to restructure the public tax burden.
Rajapaksa was elected into power earlier this month.
Following his victory, an interim 15-member cabinet was appointed to rule until parliamentary elections which are expected to be held next year.