The Cabinet has given its approval to remove the Nation Building Tax (NBT), Pay As You Earn (PAYE) Tax and Withholding Tax on interests, the Co-Cabinet Spokesperson Ministers Bandula Gunawardana said today.He mentioned this during the first press briefing to announce the decisions of the new government’s Cabinet of Ministers. It took place at the Department of Government rmation this evening.The Cabinet has further decided to reduce the telecommunications levy to 25%.These decisions were taken during the first Cabinet meeting of newly formed government held this morning (27) at the Presidential Secretariat.
The Cabinet of Ministers also decided to cut the Value Added Tax (VAT) from 15% to 8%. The ceiling for VAT has been raised to Rs. 25 million turnover per month from existing Rs. 1 million, the Co-Cabinet Spokesman said further.In the meantime, the income tax on the construction industry has also been reduced from 28% to 14%.The Cabinet also announced that all religious places are exempted from taxes.Sweeping tax cuts and removals were leading election pledges in the manifesto launched by President Gotabaya Rajapaksa in view of the recently held presidential election.
During the election campaign, President Rajapaksa vowed to remove Pay As You Earn (PAYE) and Withholding taxes and amend the existing Inland Revenue Act in order to remove the heavy tax burden imposed on the general public. He also vowed to slash the VAT to 8% and reduce the income taxes for the manufacturing sector and to make religious places exempt from all taxes.
