New tax laws

The Government is to introduce several changes with regard to finance, tax and investment related legislation in the form of amendments to the existing 14 Acts and with one new legislation in keeping with the budget proposal 2011.

The reduction of the VAT rate on financial services and on certain Goods and Services from 20 percent to 12 percent and introduction of a new VAT suspension scheme for exporters and deemed exporters, removal of the Debits Tax, removal of the Social Responsibility Levy and Cellular Mobile Subscribers' Levy are some of the proposed amendments to the existing Acts.

This was revealed at the Cabinet press briefing which was held yesterday.

With the introduction of these changes the number of taxes payable by a person will get reduced, thereby resulting in a simplification of a tax system while also improving the effectiveness of tax administration.

The overall reform oriented tax rate revisions are expected to give an impetus to investment through tax saving.

Cabinet approval was granted to submit the relevant fifteen (15) Bills in Parliament for approval.