NBT Bill was passed in Parliament on 23 October 2019 which is yet to be certified by the Hon. Speaker.
1.New Exemptions
1.1 Importation of any project related article by a BOI enterprise
Importation of any project related article by an enterprise which has entered into an agreement with the BOI of Sri Lanka under section 17 of the BOI of Sri Lanka Law, No. 4 of 1978, for the use in any project of such enterprise having a capital investment of not less than USD 50 million during the project implementation period and prior to the commencement of commercial operations has been exempted with effect from November 1,2019.
Exemption from upfront taxes (NBT, PAL, CESS, Customs Duty) were proposed in the budget for 2019 for projects exceeding an investment of USD 50 million. This amendment is pursuant to this budget proposal.
1.2 Services by hotel, guest house, restaurant or other similar business
With effect from November 1, 2019, services by hotel, guest house, restaurant or other similar business registered with the Ceylon Tourist Board, provided payment for such service is received in foreign currency through a Bank is exempted from NBT.
1.3 Manufacture of Palm Oil
Locally manufactured palm oil, out of imported crude palm oil or imported palm olein subjected to Special Commodity Levy, has been exempted with effect from November 1, 2019.
1.4 Importation of Lucerne
Importation of Lucerne (alfalfa) meal and pellets has been exempted with effect from November 1, 2019.
1.5 Importation of Yachts and other vessels
Importation of yachts and other vessels for pleasure or sports, rowing boats and canvas as classified under the HS Code 8903.91.00 has been exempted with effect from November 1, 2019.
1.6 Construction Services
Under the existing provisions, construction subcontractors and the main contractor where the relevant contract agreement had been executed prior to August 1, 2017 have been exempt from NBT.
With effect from November 1, 2019, this exemption is applicable irrespective of the date of signing the contract.
2.Removal/Restriction of Exemptions
2.1 Cigarettes
The exemption on the importation, manufacture or sale (by the importer) of cigarettes has been removed with effect from November 1, 2019
2.2 Gems and Jewellery
Importation of gemstones for the purpose of re-export upon being cut and polished- is exempt from NBT at present.
This exemption has been restricted to importation of gemstones by a person registered under the National Gem & Jewellery Authority, for the purpose of re-export upon being cut and polished and if the payment for such service of cut and polish is made in foreign currency and remitted to Sri Lanka through a bank.
3.Extension of time bar for raising additional assessments
Time bar has been increased from 18 months to 30 months from the 30th day of November of the year of assessment immediately succeeding the year of assessment in which such relevant quarter falls for any period commencing on or after April 1, 2018.
4.Applicability of certain provisions of the Inland Revenue Act
The clauses of Inland Revenue Act No. 24 of 2017 regarding administration, record keeping and Information collection, assessments, objection and appeals, interest, recovery of tax, penalties, criminal proceedings and regulations shall apply on or after April 1, 2018.
