Professional Documents
Culture Documents
The Sri Lankan government offers a wide range of incentives for investors. These incentives are available foreign provided the investment is undertaken through a company incorporated in Sri Lanka Incentives offered fall under two classes or "regimes" and the investor may be eligible for inducements provided by either of these regimes. BOI Incentives under Section 17 of the BOI Law General incentives under the 'normal laws' of the country
Income tax
The tax is levied on the Income of any person arising in or derived from Sri Lanka. A resident is taxable on world income Any other person is taxable only on income arising or derived in Sri Lanka.
Custom Duty
Sri Lanka Customs is a key state organization operational at the frontiers and its main functions center around revenue collection and enforcing Customs law and other related rules and regulations In the process the department endeavors to ensure smooth movement of people and goods across the border. Custom duty is applicable for the import and export procedures.
Remittance Tax
In addition to paying the Standard corporate income tax , remittances made by a branch to a foreign head office are subject to a 10% tax.
Agro processing Processing of any agricultural product or fishing product including deep sea fishing. Rs.10Mn Incorporated post 01/04/2002
New undertaking Year 6 -7 on or after 01/04/2006 10% with minimum Year 8 Investment onwards Rs.50Mn 15% Incorporated pre 01/04/2002
Year 1 10/15 0%
North /East Province Regional Year 1 Cultivation and development outside 0% processing Colombo and Gampaha District Dairy farming and livestock development New Company Cultivation processing of and vegetables and Minimum Investment fruits Rs.15Mn
Minimum Employees Rice Mill for the - 20 grinding of rice and/or the making of rice based products
Providing accommodation to Registered with Ceylon Year 1 3 Tourists in Manor Houses or Tourist Board on or after Thematic Bungalows 01/04/2003 Provide accommodation for 10 years from date of registration with Tourist Board
any
Exhibition of Year 1 5/10 cinematographic film on or after April 2007 In new cinema or upgraded cinema defined
0%
Minimum Rs.10Mn
onwards
Tourism and Recreation or Regional Development outside construction and operation Colombo/Gampaha Districts of hotels North/East Year 1 -15 Province New Company Minimum Investment Rs.40Mn Minimum employees - 25
0%
New Undertaking on or after 01/04/2006 within Year minimum Investment 10% Rs.50Mn-Incorporation pre 01/04/2002 Rs.10MnIncorporationpost 01/04/2002
6-7
Minimum Investment US$ 150,000 First two years 10% Employing minimum of 15 technically qualified Thereafter local persons 20% (15% if export turnover > 70% in foreign currency)
20%
Power Generation New Company Tourism and Recreation Construction and/or operation of Minimum warehouses Investment US$ Garbage collection and /or 500,000 disposal Construction of supermarkets Construction of houses Construction of hospitals Water supply Infrastructure required for film or cinema industry Special project as approved by cabinet of Ministers/Cabinet sub committee on investment facilitation
-7
onwards
-5
6-7
Mew Company
onwards
0% 15%
Year 1 -8 0% Year 9 onwards 15% Year 1-10 0% Year 11 0nwards 15% Year 1 -12 0% Year 13 0nwards 15%
Establishment of industrial New Company estates including development and Minimum Investment management of Industrial US$ 500,000 Estates and Special Economics Zones
Year 0%
-3/15
Thereafter 15%
Year 0%
-5
years
Industrial or other New Company business activity connected to advance Minimum Investment technology or which of US$ 5Mn pioneering nature
-7
Year 8 onwards 20% (15% if >80% exported / >70% of turnover in foreign currency)
Training Institutions
Company
Minimum Investment US$ 100,000 First two 10% Provide training for not less than 250 students per Thereafter annum and 500 students 20% per annum if already in existence
years
Minimum Investment US$ 150,000 First two 10% 70% of turnover in foreign currency Thereafter 15%
years
Production / Manufacturing New Company of textile for export including fabric Minimum manufacturing , printing , Investment US$ dyeing , washing and 500,000 finishing Minimum export 80% of output
two
years
Thereafter 15%
North /East Province Regional Development Year Manufacture of textile outside Colombo and 0% and apparel Gampaha Districts New Company Minimum Rs.40Mn Investment
-7
onwards
Production/Manufacture of non New Company Year 1-3/7 traditional goods for export, Minimum Investment First 2 years including deemed exports US$250,000 Thereafter Minimum export 80% of output Export of services as determined by the BOI New Company Year 1 -5 Minimum Investment Year 6-7 US$ 500,000 Year 8 onwards 70% of Turnover in convertible foreign currency
0% 10% 15%
0% 10% 15%
Houses/
New Company Annual Turnover Warehouse within custom US$ 5-10Mn 10% bonded area US$ 10-25Mn 5% Export -100% >US$ 25Mn(1-5Yrs) 0% Thereafter 15%
onwards
Modernization of food Company and beverages , processing units in the Minimum Investment export plantation sector 150,000 to qualify HACCP or international accreditation
-5
Year Minimum Investment 15% Rs.2 Mn within 1 year from commencement of undertaking
onwards
New Company
Year 0% 6
-5
onwards
-7
onwards
onwards
Light and heavy No reduction or engineering industries withdrawal of investment during Refrigerated transport period of exemption services or cold room storage services
Industrial or other business activity connected to advanced technology or which is of pioneering nature
0% 15%
Transfer Tax
A non-citizen who acquires immovable property in Sri Lanka must pay additional stamp duty of 100% of the value of property. Any Company which has been approved by the BOI , obtains a land under exempted sectors ( to be satisfied with Investment requirement) will be exempted from payment of 100% land transfer tax provided the total value of land is met by inward remittances of foreign currency.
Useful Websites
www.inlandrevenue.gov.lk www.boi.lk
Thank You