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Sri Lanka: Tax reform proposals presented to Parliament include VAT on nonresident digital service providers

Proposals presented to Parliament by the president on December 18, 2024

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December 19, 2024

The president on December 18, 2024, presented various tax reform proposals to Parliament, including:

  • Increase in rate of advance income tax (AIT) on interest from 5% to 10%--effective April 1, 2025
  • Introduction of concessionary corporate income tax rate of 15% on foreign service providers鈥攅ffective April 1, 2025
  • Increase in corporate income tax (CIT) rate from 40% to 45% on gains and profits from betting and gaming, manufacture and sale or import of any liquor or tobacco products鈥攅ffective April 1, 2025
  • Reintroduction of exemption from value added tax (VAT) for locally produced liquid milk and locally manufactured yogurt鈥攅ffective April 1, 2025
  • Introduction of 18% VAT on nonresident digital service providers to Sri Lankan consumers
  • Increase in stamp duty on leases to 2%

Read a聽聽prepared by the 乐鱼(Leyu)体育官网 member firm in Sri Lanka

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