Colombo, November 28 (Xinhua/newsin.asia): 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 percent to 8 percent starting Dec. 1, while a telecommunications levy will be reduced from 30 percent to 5 percent.
Taxes on the construction industry have been reduced from 28 percent to 14 percent 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.
Tax on bank deposit interest will be removed said cabinet spokesman Bandula Gunawardene on Thursday. The IT sector will be free of all taxes. Revenue taxes have been reduced from 24% to 18% Gunawardene added.
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.
(The featured image at the top shows Sri Lankan Prime Minister cum Finance Minister Mahinda Rajapaksa)