Setting up in Sri Lanka - How To Set Up?

Section 4: Investment Incentives

Strategic Development Projects Act No. 14 of 2008

Qualifying Criteria Incentives

Projects which are in the national interest and which are likely to bring economic and social benefit to the country and which are also likely to change the landscape of the country, primarily through:

  1. The strategic importance attached to the proposed provision of goods and services, which will be of benefit to the public
  2. The substantial inflow of foreign exchange to the country
  3. The substantial employment which will be generated and the enhancement of  income earning opportunities
  4. The envisaged transformation in terms of technology

Exemptions of up to a maximum duration of 25 years from the applicability of the provisions of one or more of the following:

  1. The Inland Revenue Act No. 10 of 2006 and its Amendments
  2. The Value Added Tax Act No. 14 of 2002 and its Amendments
  3. Port and Airport Development Levy Act No. 18 of 2011
  4. The Finance Act No. 5 of 2005
  5. The Excise (Special Provision) Act No. 13 of 1989
  6. The Economic Service Charge Act No. 13 of 2006 and its Amendment
  7. Nation Building Tax Act No 9 of 2009 and its Amendment
  8. Customs Ordinance (Chapter 235)

Under "Normal Law"

Section 16A, 16B of Inland Revenue (Amended) Act no 22 of 2011

Category

Incentives

Undertaking for Fishing (Section 16A)
This includes any:

  • Cleaning , Sizing, Sorting, Grading, Chilling, Cutting Dehydrating, Packing or Canning of fish in preparation of such produce for the market

Exempt from income tax for 5 years commencing from April 1, 2011.

Producing Agriculture seeds or planting materials or primary processing of such seeds or materials (Section 16B)
This includes any:

  • Cleaning , Sizing, Sorting, Grading, Chilling, Cutting Dehydrating, Canning or Packaging for the purposes of preparation of such produce for the market

Exempt from income tax for 5 years commencing from April 1, 2011.

Section 16C of Inland Revenue (Amended) Act no 22 of 2011

The Manufacture of any article other than any liquor or tobacco products (Section 16C)

Amount of Investment

Period of Exemption

Investing more than Rs 50 Million in fixed assets in a new undertaking on or after April 1, 2011 which manufactures any article other than liquor or tobacco products.

Exempt from income tax for a period of 3 years

Investing more than Rs 50 Million in the acquisition of fixed assets after November. 22, 2010 but before March 31, 2012

Exempt from income tax for a period of 3 years

Investment with Tax Incentives (Section 17) - (As per Budget 2012)

Publications and Norms
Publications and Norms
Publications and Norms