Twelve Tax Reforms Deepen Economic Pressure on Sri Lankans

Sri Lanka’s twelve tax reforms introduced over the past two years have intensified economic hardship among households, professionals and businesses, with small and medium-sized enterprises (SMEs) bearing a disproportionate burden, according to a new economic research report by the Sri Lankan Human Rights Center.

The report warns that revenue-raising measures introduced since the Government assumed office have increased the cost of essential goods and services, affecting food supplies, education, healthcare, transportation and online businesses.

the cumulative impact of taxation had accelerated inflation, restricted market liquidity, deepened poverty and discouraged both domestic investment and foreign direct investment.

Among the major measures are increased excise duties, higher vehicle import taxes, doubled withholding tax on bank interest from 5% to 10%, a 15% tax on previously exempt export services and a 5% professional retention tax on monthly earnings exceeding Rs.100,000.

The report also highlights increased profit taxation affecting partnerships, trusts and NGOs, alongside the proposed 18% VAT on foreign digital services.

 

Spread the love
Tags:

Leave A Comment