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Officials get ready to collect hundreds of millions in extra taxes
View(s):With six finance bills coming into effect from Friday, the Government is taking measures to collect hundreds of millions of rupees in taxes, Inland Revenue Commissioner General Kalyani Dahanayake said.
She said the department would be moving to collect the taxes with retrospective effect as provided for in the new laws.
Among the taxes and levies which have come into effect are the mansion tax, the mobile telephone operator levy, the direct-to-home satellite services levy, the bars and taverns levy, the casino levy, the super gain tax, the dedicated sports channel levy and the motor vehicles importer licence levy.
However, tax officials said they feared they would run into issues in collecting some of these taxes. They said that one of the issues would be the collection of the Migration Tax which had retrospective effect from April 1. According to the new law, a person permanently migrating has to pay as tax 20 per cent of the foreign exchange released to be taken out of the country.
State Finance Minister Lakshman Yapa Abeywardena said that due to practical difficulties some of the taxes could be collected only from this month.
The following is a snapshot of new taxes:
Special Levy on Bars and Taverns
A special levy of Rs. 250,000 is imposed on taverns or liquor sales outlets. This will be a one off payment.
Special Levy on the Casino Industry
All casino operators are required to pay one-off Rs. 1,000 million special levy.
Super Gains Tax
The Super Gains Tax is also a one-off payment. Accordingly, any company or individual who has earned more than Rs. 2,000 million as profit in the tax year 2013/2014 is liable to pay 25% of its profit. The Government says this tax is a means by which the super profits of companies can be channeled back to the general public. The expected revenue from this tax is Rs. 50,000 million in 2015.
Mansion Tax
Rs. 1 million will be levied annually from owners of houses worth Rs. 100 million or more or houses with a floor area exceeding 5000 square feet. The tax would be collected through the local authorities. This will be in addition to local authority rates and taxes.
Migration Tax
Sri Lankans leaving the country permanently will have to pay as taxes 20 percent of the foreign exchange they will be taking out of the country.
Levy on Licensed Mobile Telephone Operators
A one-off levy of Rs. 250 million is imposed on all licensed mobile telephone operators in Sri Lanka.
Levy on Direct-to-Home Services via Satellite
The Government says there are companies providing Direct-to-Home-via-satellite services with more than 50,000 subscribers. They have been in business in Sri Lanka for many years but have not paid any special levy. These companies will have to pay a one-off levy of Rs. 1,000 million.
Levy on Utilisation Satellite Location Levy
Satellite owners who utilise the location reserved for Sri Lanka’s satellite will have to pay a special levy of Rs. 1 billion on a one off basis.
Dedicated Sports Channels Levy
A levy of Rs. 1,000 million is imposed on dedicated sports channels operating island-wide using more than five transmitting locations.
Motor Vehicle Importers Licence
An annual licence fee of Rs. 1.5 million will be charged from vehicle importers, whether they import brand new or used vehicles.