Taxation in Sri Lanka

The tax revenue to GDP ratio is just about 11.6 percent as of 2018, which is one of the lowest rates among the upper-middle income earning countries.

[4] However the tax regime is expected to witness major changes following the 2019 Sri Lankan presidential election which took place on 16 November 2019.

[5][6] The Maithripala Sirisena led government also announced that the carbon tax will be removed with immediate effect as of 1 December 2019.

[12] However the new amendments which were published on 19 December 2022 have increased the PAYE tax rates significantly and reduced the annual personal income reliefs to 12 million rupees.

[17] However in 2019, the Sri Lankan government implemented measures to curtail import expenditure and to promote exports in order to avoid the trade deficit.

However Duty-free permit, a tax concession is also granted specially for the government officials to import vehicles into Sri Lanka.