Value Added Tax ( VAT)

Value Added Tax (VAT) [ Amendments to VAT Act No 14 of 2002]

Removal of exemptions

Import or supply of imported goods set out below will be liable for VAT:

Item Description Exempted HS Code

Plants & Flowers 06.01, 06.02.10, 06.02.20, 06.02.30, 06.02.40,06.02.90.90

Plastic Beads 39.26.90.70

Yarn /Fabrics 50.01, 50.02, 50.03, 50.04, 50.05, 50.06, 50.07, 51.11,51.12, 51.13, 52.01, 52.03, 52.05, 52.06, 52.08, 52.09,52.10, 52.11, 52.12, 53.09, 53.10, 54.02, 54.03, 54.07,54.08, 55.09, 55.10, 55.12, 55.13, 55.14, 55.15, 55.16,58.01, 58.02, 58.04.21, 58.04.29, 58.04.30, 58.06,58.09, 58.11, 60.01, 60.02, 60.03, 60.04, 60.05, 60.06,62.15

Wood & Articles 44.03, 44.07, 44.08, 44.09

Dyes 32.04.11, 32.04.12, 32.04.13, 32.04.14, 32.04,15,32.04.16,32.04.17

Glass Beads 70.18.10

Plant and Machinery/Industrial racks
84.07, 84.11.91, 84.13.40, 84.43.19.10, 84.43.32.30,84.43.32.40, 84.43.39.20, 84.43.99.30, 84.44, 84.45,
84.46, 84.47, 84.48, 84.51.40.10, 84.51.50,84.51.80.10, 84.51.90, 84.70.10, 84.79.89.10,84.79.89.20, 84.79.89.30 84.79.89.40

Electronic goods 85.16.40, 85.16.72, 85.27.21, 85.27.29, 85.27.91,85.27.92, 85.39.31.20, 85.43.70.30, 85.43.70.90,
85.43.90

Aeroplanes & Parts 88.02, 88.03.30, 88.05.21, 88.05.29 Spectacles 90.01, 90.02, 90.03, 90.04, 90.05

Cameras & Projectors 90.06, 90.07, 90.08, 90.10

Watches 91.01, 91.02, 91.05

Sale of condominium housing units

New Exemption
Solar tracker classified under HS Code 84.79.89.50

VAT Refunds

VAT refund
scheme for foreign passport holders will be implemented at the Airports and Sea Ports with effect from 01st May 2018.

Nation Building Tax (NBT)

Nation Building Tax (NBT) [Amendments to NBT Act No.9 of 2009]

Exemptions

Importation of non-motorized equipment and accessories for water sports such as Kayaks, Canoes, Kite Surfing, and diving

Importation of non-powered equipment and accessories for aero sports such as Hang Gliding, Ballooning, dirigibles, Parachutes and Para-Gliders

Importation of gem stones for cutting and re-export purposes

Importation of equipment that enables advanced technology agriculture practices, including greenhouses, poly tunnels and materials for the construction of greenhouses, by any grower.

Exemption on liquor will be removed.

Economic Service Charge (E S C )

Economic Service Charge ( ESC) [Amendments to ESC Act No 13 of 2006]

ESC base for imported motor vehicles will be amended as follows;

i. Motor vehicles liable for Excise duty – Payable Excise Duty

ii. Motor vehicles not liable for Excise duty – CIF value

Customs Import Duty

Customs Import Duty

Exemption of Custom Import Duty

Importation of Crust (semi processed) leather for further processing (Tanning Industry) and supply of raw materials for leather products industry.

Importation of machinery, equipment, accessories and raw materials or intermediate materials, to be used only for manufacturing of biodegradable packaging products and materials.

Customs Import Duty will be updated on importation of goods in line with the HS 2017 version and also revised on importation of selected goods.

CESS Duty

CESS Duty

Cess will be removed on 253 items under the HS Codes specified in Table 1, facilitating the emerging sectors namely, tourism, value adding industries and other industries.

Cess will be revised on 22 items classified under the following HS Codes, facilitating the availability of goods for value addition and consumption purposes.
0406.10.00 0406.40.00 0709.99.12 0709.99.20
0712.20.00 2922.42.10 4805.24.00 4805.25.00
4810.29.00 5208.11.20 5208.21.10 5208.21.90
6402.19.90 6403.19.90 6506.10.20 8509.40.00
8708.91.10 8708.91.20 4013.90.10 4013.90.90
9105.21.00 9105.29.00

Table 1
List of items selected for removal of CESS Duty
0201.10.00 0209.90.00 2101.20.12 4010.19.00 7607.20.20 0207.45.00 6910.10.10
0201.20.00 0210.11.00 2101.20.13 4010.31.00 7608.10.00 0207.51.00 6910.10.90
0201.30.00 0210.12.00 2101.20.19 4010.32.00 7608.20.00 0207.52.00 6910.90.10
0202.10.00 0210.19.00 2106.90.97 4010.33.00 7615.20.10 0207.53.00 7228.30.00
0202.20.00 0210.20.00 2201.10.10 4010.34.00 7802.00.00 0207.54.00 7404.00.00
0202.30.00 0210.91.00 2201.10.90 4010.35.00 7902.00.00 0207.55.00 7503.00.00
0203.11.00 0210.92.00 2201.90.10 4010.36.00 8002.00.00 0207.60.00 7602.00.00
0203.12.00 0210.93.00 2201.90.90 4010.39.00 8301.20.00 0208.10.00 7604.29.00
0203.19.00 0210.99.00 2203.00.10 4011.30.00 8301.70.00 0208.30.00 7607.20.10
0203.21.00 0305.10.00 2203.00.20 4011.70.00 8304.00.00 0208.40.00 9404.29.10
0203.22.00 0305.20.00 2203.00.90 4011.80.10 8306.10.10 0208.90.90 9404.29.20
0203.29.00 0305.59.10 2204.10.00 4011.80.90 8413.60.00 0209.10.00 9404.29.30
0204.10.00 0305.59.90 2204.21.00 4012.13.00 8413.70.11 0902.40.91 9404.29.90
0204.21.00 0403.10.00 2204.22.00 4012.90.10 8413.70.19 0902.40.92 9404.30.10
0204.22.00 0403.90.00 2204.29.00 4014.10.00 8415.10.10 0902.40.93 9404.30.90
0204.23.00 0405.10.00 2204.30.00 4014.90.00 8415.20.10 0902.40.99 9404.90.10
0204.30.00 0405.20.00 2205.10.00 4016.93.10 8415.20.90 1001.99.90 9603.90.90
0204.41.00 0405.90.00 2205.90.00 4016.93.20 8418.10.10 1513.21.00 9613.10.00
0204.42.00 0804.10.10 2206.00.10 4016.99.10 8418.10.90 1513.29.00 9613.20.00
0204.43.00 0804.10.20 2207.10.00 4016.99.20 8418.29.10 1517.10.30
0204.50.00 0806.20.00 2207.20.10 4017.00.10 8418.29.20 1517.10.90
0205.00.00 0808.30.00 2207.20.90 4301.10.00 8418.29.30 1803.10.00
0206.10.00 0809.40.00 2501.00.00 4301.30.00 8418.29.90 1804.00.00
0206.21.00 0810.50.00 2523.30.00 4301.60.00 8418.91.10 2101.20.11
0206.22.00 0810.90.90 2523.90.00 4301.80.00 8420.10.00 3912.11.00
0206.29.00 0902.30.13 2712.20.00 4301.90.00 8421.21.10 3912.12.00
0206.30.00 0902.30.19 2712.90.00 4302.11.00 8421.21.90 3912.20.00
0206.41.00 0902.30.23 3302.90.00 4302.19.10 8421.23.90 3913.10.00
0206.49.00 0902.30.29 3307.90.10 4302.19.90 8423.10.20 3914.00.00
0206.80.00 0902.30.33 3401.20.10 4302.20.00 8438.80.40 3916.10.00
0206.90.00 0902.30.39 3906.10.90 4302.30.00 8516.60.90 3916.20.00
0207.24.00 0902.40.11 3909.10.00 4823.70.00 8539.22.00 3917.40.10
0207.25.00 0902.40.12 3909.20.00 4911.99.30 8546.20.00 3926.10.10
0207.26.00 0902.40.13 3909.31.00 6701.00.00 8708.70.10 4007.00.00
0207.27.00 0902.40.19 3909.39.00 6703.00.00 8708.92.00 4010.11.00
0207.41.00 0902.40.21 3909.40.00 6704.11.00 8708.99.40 4010.12.00
0207.42.00 0902.40.22 3910.00.00 6704.19.00 8712.00.20 6801.00.00
0207.43.00 0902.40.23 3911.10.00 6704.20.00 8712.00.90 6815.20.00
0207.44.00 0902.40.29 3911.90.00 6704.90.00 8714.92.10 6815.91.00

Ports and Airports Development levy (PAL)

Ports and Airports Development levy

PAL on the items classified under following HS Codes will be reduced
8415.90.90 8418.91.10 8418.91.208418.99.00 8414.30.00 8450.90.00 8401.40.00 7411.10.00 8501.10.90 8414.90.10
7212.40.00 3920.30.10 9032.10.00 7210.30.00 8483.50.00 8501.20.00 8471.41.90 8471.49.90 8471.50.90 8473.30.90

PAL on the 253 items classified under HS Codes specified in Table 2, including importation of non-powered equipment and accessories for aero sports such as Hang Gliding, Ballooning, dirigibles, Parachutes and Para-Gliders will be removed.

PAL will be revised on the importation of non-motorized equipment and accessories for water sports such as Kayaks, Canoes, Kite Surfing, and diving.

Table 2

List of items selected for removal of PAL Duty

0101.21.00 0504.00.00 1205.10.00 2701.20.00 2834.10.00
0101.21.00 0505.10.00 1205.90.00 2705.00.00 2835.24.00
0101.29.00 0505.90.00 1206.00.00 2707.20.00 2836.60.00
0101.30.00 0507.10.00 1207.10.10 2708.10.00 2836.91.00
0101.90.00 0507.90.00 1207.21.00 2710.12.10 2836.92.00
0102.21.00 0508.00.10 1207.29.00 2710.19.10 2837.11.00
0102.29.00 0508.00.20 1207.30.00 2710.91.00 2837.19.00
0102.31.00 0508.00.90 1207.50.00 2711.12.00 2837.20.00
0102.39.00 0510.00.10 1207.60.00 2711.19.90 2840.11.00
0102.90.00 0510.00.90 1207.70.00 2711.29.00 2841.30.00
0103.10.00 0511.10.00 1207.91.00 2713.90.00 2841.80.00
0103.91.00 0511.91.10 1207.99.10 2716.00.00 2842.90.10
0103.92.00 0511.91.20 1207.99.90 2801.30.00 2842.90.20
0104.10.10 0511.91.20 1209.10.00 2802.00.00 2842.90.30
0104.10.90 0511.99.10 1209.21.00 2804.40.00 2843.10.00
0104.20.10 0511.99.20 1209.22.00 2804.50.90 2843.29.00
0104.20.90 0511.99.40 1209.23.00 2804.61.00 2843.30.00
0105.11.10 0511.99.50 1209.24.00 2804.80.00 2845.10.00
0105.11.10 0511.99.60 1209.25.00 2804.90.10 2846.10.00
0105.11.20 0511.99.90 1209.29.00 2805.12.00 2849.90.00
0105.11.20 0601.10.00 1209.30.00 2805.19.00 2850.00.00
0105.11.90 0601.20.10 1502.10.00 2806.20.00 2852.10.00
0105.12.10 0601.20.90 2502.00.00 2809.10.00 2852.90.00
0105.12.90 0602.10.00 2504.90.90 2811.11.00 2853.10.00
0105.13.10 0602.20.00 2505.10.10 2811.12.00 2853.90.00
0105.13.90 0602.30.00 2505.10.91 2811.29.20 2901.22.00
0105.14.10 0602.40.00 2508.50.00 2812.19.00 2901.23.00
0105.14.90 0602.90.10 2508.60.00 2812.90.00 2901.24.00
0105.15.10 0602.90.20 2508.70.00 2813.10.00 2901.29.00
0105.15.90 0604.20.00 2510.20.90 2815.30.00 2902.11.00
0105.94.00 0604.90.00 2511.10.00 2819.90.00 2902.20.00
0105.99.00 0709.99.11 2515.11.00 2820.90.00 2902.42.00
0106.12.00 0713.31.11 2515.20.00 2822.00.00 2902.43.00
0106.13.00 0713.31.21 2516.20.00 2824.10.00 2902.60.00
0106.14.00 0713.32.10 2518.10.00 2824.90.00 2903.13.00
0106.19.10 0713.33.10 2518.20.00 2825.10.00 2903.19.10
0106.19.20 0713.34.10 2518.30.00 2825.20.00 2903.22.00
0106.19.90 0713.35.10 2525.10.00 2825.30.00 2903.29.10
0106.20.00 0713.39.10 2528.00.10 2825.40.00 2903.82.00
0106.31.00 0802.21.90 2528.00.90 2825.50.00 2903.99.90
0106.32.00 0802.22.00 2530.90.20 2825.70.00 2904.20.10
0106.32.00 0802.31.90 2601.11.00 2825.80.00 2904.20.90
0106.33.00 0802.32.00 2602.00.00 2826.30.00 2905.16.00
0106.39.00 0810.20.00 2604.00.00 2827.31.00 2905.19.10
0106.41.00 0810.30.00 2608.00.00 2827.35.00 2905.29.00
0106.49.00 0810.40.00 2615.90.00 2827.41.00 2905.43.00
0106.90.00 0810.50.00 2617.10.00 2829.11.00 2905.49.00
0501.00.10 1061.10.00 2617.90.00 2830.90.00 2905.59.00
0501.00.90 1202.30.00 2620.11.00 2831.90.00 2906.12.00
0502.90.00 1204.00.00 2620.99.90 2833.29.10 2906.13.00
4704.21.00 4905.91.00 7019.11.00 7405.00.00 8411.21.00
2907.15.00 2918.19.00 2932.99.10 3801.20.00 4113.30.90
2907.21.00 2918.22.00 2933.11.00 3802.10.31 4114.10.00
2907.23.00 2918.30.00 2933.32.00 3802.10.32 4114.20.00
2907.29.00 2918.91.00 2933.33.00 3806.20.00 4206.00.00
2908.19.10 2918.99.10 2933.39.20 3807.00.10 4301.10.00
2908.19.90 2919.10.00 2933.49.00 3809.10.00 4301.30.00
2908.99.10 2919.90.10 2933.52.00 3811.11.00 4301.60.00
2908.99.90 2919.90.90 2933.54.00 3813.00.10 4301.80.00
2909.19.90 2920.19.90 2933.59.10 3814.00.20 4301.90.00
2909.20.90 2920.21.00 2933.79.00 3814.00.30 4302.11.00
2909.30.10 2920.22.00 2933.99.10 3815.12.00 4302.19.10
2909.30.99 2921.22.00 2934.10.00 3817.00.20 4302.19.90
2909.4110 2921.30.00 2934.91.00 3818.00.00 4302.20.00
2909.49.10 2921.42.00 2937.12.00 3824.30.00 4302.30.00
2909.50.10 2921.43.00 2937.19.00 3824.75.00 4303.10.00
2909.60.10 2921.44.00 2937.22.00 3824.79.00 4303.90.00
2910.10.00 2921.45.00 2937.29.00 3825.50.00 4304.00.00
2910.20.00 2921.49.00 2937.90.00 3826.00.00 4401.11.00
2910.30.00 2922.17.00 2938.10.00 3904.61.00 4401.12.00
2910.40.00 2922.19.00 2939.19.00 3904.69.00 4401.21.00
2910.50.00 2922.21.00 2939.20.00 3907.70.00 4401.22.00
2911.00.00 2922.29.10 2939.30.00 3912.11.00 4401.31.00
2912.12.00 2922.29.90 2939.69.00 4011.30.00 4401.39.00
2912.21.00 2922.39.00 2941.20.00 4012.13.00 4402.10.00
2912.49.00 2922.44.00 2941.30.00 4101.20.00 4402.90.10
2912.50.90 2924.23.10 2941.40.00 4101.50.00 4402.90.90
2913.00.00 2924.23.20 3102.50.00 4102.10.00 4404.10.00
2914.19.00 2926.10.00 3102.80.00 4102.21.00 4404.20.00
2914.23.00 2926.20.00 3103.90.00 4102.29.00 4406.11.00
2914.61.00 2926.90.00 3201.10.00 4103.20.00 4406.12.00
2914.62.00 2930.20.10 3201.90.00 4103.90.00 4407.99.10
2914.71.00 2930.20.90 3301.30.00 4103.90.00 4412.39.10
2914.79.00 2930.90.10 3307.90.10 4104.11.90 4413.00.10
2915.13.00 2930.90.20 3502.90.00 4104.19.10 4418.40.00
2915.24.00 2930.90.40 3507.90.10 4104.19.90 4418.50.00
2915.40.00 2931.31.00 3604.10.00 4104.41.00 4501.10.00
2916.15.00 2931.32.00 3605.00.00 4104.49.00 4501.90.00
2916.20.10 2931.34.00 3606.10.00 4105.10.00 4502.00.00
2916.20.20 2931.36.00 3606.90.00 4105.30.00 4503.10.00
2916.20.50 2931.37.00 3701.20.00 4106.21.00 4503.90.00
2916.20.90 2931.38.00 3702.31.10 4106.22.00 4504.10.00
2916.34.00 2931.39.00 3702.32.00 4106.31.00 4504.90.00
2916.39.00 2932.11.00 3702.39.00 4106.32.00 4701.00.00
2917.12.00 2932.12.00 3702.53.90 4106.40.10 4702.00.00
2917.13.00 2932.13.00 3702.54.00 4106.40.90 4703.11.00
2917.33.00 2932.14.00 3702.96.20 4106.91.00 4703.19.00
2917.36.00 2932.20.10 3702.96.90 4106.92.00 4703.21.00
2918.12.00 2932.20.90 3702.97.20 4112.00.00 4703.29.00
2918.13.00 2932.93.00 3704.00.10 4113.20.00 4704.11.00
2918.17.00 2932.94.00 3706.90.00 4113.30.10 4704.19.00
4706.10.00 4907.00.10 7019.12.00 7410.21.00 8411.22.00
4706.20.00 4907.00.20 7019.52.00 7410.22.00 8411.81.00
4706.30.00 4907.00.30 7019.90.20 7411.22.00 8411.82.00
4706.91.00 4907.00.40 7020.00.10 7419.10.00 8411.91.00
4706.92.00 4911.91.30 7020.00.40 7419.99.20 8412.10.00
4706.93.00 5113.00.00 7113.11.90 7501.20.00 841 8.50.9
4707.10.00 5202.10.00 7113.20.90 7502.10.00 8421.23.00
4707.20.00 5207.90.00 7114.11.00 7502.20.00 8428.10.10
4707.30.00 5208.11.20 7114.20.00 7504.00.00 8428.31.00
4707.90.00 5208.21.10 7116.10.00 7505.12.00 8429.30.00
4802.10.00 5208.21.90 7118.90.90 7505.21.00 8430.20.00
4802.20.00 5305.00.93 7201.20.00 7507.20.00 8430.31.00
4802.40.00 5308.10.00 7202.19.00 7801.91.00 8430.50.00
4802.54.20 5311.00.90 7202.29.00 7804.20.00 8432.90.10
4802.55.10 5607.29.00 7204.21.00 7901.20.00 8435.90.00
4802.56.10 5608.11.10 7205.21.00 7905.00.00 8438.60.00
4802.57.10 5702.39.10 7206.90.00 8001.20.00 8439.10.00
4802.58.20 5702.42.00 7207.20.90 8003.00.00 8439.91.00
4802.61.10 5702.50.20 7208.26.00 8041.11.10 8440.90.00
4802.62.10 5702.50.90 7208.37.00 8102.96.00 8442.40.00
4802.62.20 5702.99.00 7208.38.00 8103.90.00 8443.32.20
4802.62.90 5704.90.10 7218.10.00 8104.19.00 8444.00.00
4804.41.00 5906.91.00 7218.91.00 8104.30.00 8445.11.00
4804.49.00 5908.00.00 7218.99.00 8105.20.00 8445.12.00
4804.51.00 5911.31.00 7221.00.00 8106.00.90 8445.13.00
4805.12.00 6402.19.10 7222.11.00 8107.20.00 8445.19.00
4805.30.00 6403.19.10 7225.50.00 8107.90.00 8445.20.00
4805.50.00 6602.00.90 7225.99.00 8108.20.00 8445.40.00
4805.91.00 6703.00.00 7226.20.00 8109.20.00 8445.90.00
4805.92.10 6704.11.00 7226.92.00 8109.90.00 8446.10.00
4805.92.90 6704.19.00 7227.10.00 8111.00.90 8447.11.00
4805.93.10 6704.20.00 7228.10.00 8112.21.00 8448.11.00
4806.20.00 6704.90.00 7228.50.00 8112.29.00 8448.19.00
4808.40.10 6801.00.00 7228.80.00 8113.00.10 8448.20.00
4810.13.10 6901.00.10 7302.30.00 8113.00.90 8448.31.00
4810.14.10 7001.00.90 7304.51.10 8212.20.10 8448.32.00
4810.31.00 7002.10.00 7305.12.90 8215.91.00 8448.33.00
4810.32.00 7002.20.00 7305.20.90 8401.10.00 8448.39.00
4810.39.00 7002.31.00 7305.31.90 8401.20.00 8448.42.00
4811.10.00 7002.39.00 7305.39.10 8401.30.00 8454.10.00
4812.00.00 7003.20.00 7306.11.10 8401.40.00 8457.20.00
4813.10.00 7003.30.00 7306.19.10 8406.10.00 8459.10.00
4818.50.10 7010.10.00 7315.20.00 8406.81.00 8459.21.00
4822.10.00 7010.20.00 7321.19.00 8407.31.10 8459.31.00
4901.99.20 7011.20.00 7321.82.00 8407.32.10 8459.39.00
4903.00.00 7014.00.10 7326.20.10 8407.33.10 8459.49.00
4904.00.10 7015.10.00 7402.00.00 8407.34.10 8459.51.00
4904.00.90 7017.10.10 7403.12.00 8409.10.00 8460.12.00
4905.10.00 7017.20.10 7404.00.00 8411.01.20 8460.19.00
8460.31.00 8532.22.10 8703.10.29 9017.10.00
8460.40.00 8532.23.10 8801.00.00 9017.20.10
8461.20.00 8532.23.90 8802.11.00 9017.20.30
8461.30.00 8532.24.10 8802.12.00 9031.41.00
8461.40.00 8532.24.90 8802.30.00 9101.19.10
8468.10.00 8532.25.10 8802.40.00 9108.11.00
8470.30.00 8532.29.10 8802.60.00 9108.12.00
8472.90.10 8532.30.10 8803.20.00 9108.19.00
8472.90.90 8532.90.10 8803.30.00 9108.90.00
8473.10.90 8533.10.00 8803.90.00 9113.10.00
8473.40.10 8533.21.00 8804.00.11 9114.10.00
8473.50.10 8533.31.00 8804.00.19 9114.30.00
8475.10.00 8533.39.00 8804.00.90 9114.40.00
8475.21.00 8533.90.00 8805.10.00 9208.10.00
8476.81.00 8540.20.00 8805.21.00 9208.90.00
8479.89.20 8540.40.00 8805.29.00 9209.30.00
8479.89.50 8540.60.00 8903.10.10 9209.91.00
8501.61.10 8540.79.00 8903.99.10 9209.92.00
8501.61.90 8540.91.00 8904.00.10 9209.94.00
8501.62.00 8540.99.00 8904.00.90 9209.99.10
8501.63.00 8541.10.00 8905.10.00 9209.99.20
8501.64.00 8541.21.00 8905.20.00 9301.10.00
8502.40.00 8541.40.00 8905.90.00 9301.20.00
8506.30.00 8541.50.00 8906.10.00 9301.90.00
8506.40.00 8541.60.00 8906.90.00 9302.00.00
8506.60.00 8541.90.00 8907.10.00 9303.90.00
8519.20.00 8543.10.00 8907.90.00 9307.00.00
8519.30.00 8543.30.00 8908.00.00 9401.10.10
8519.50.00 8543.70.10 9001.20.00 9401.10.90
8519.81.10 8544.20.10 9002.20.00 9405.50.20
8522.10.00 8545.11.00 9002.90.00 9504.90.10
8523.29.20 8545.19.10 9003.90.10 9506.11.00
8527.12.00 8545.19.90 9003.90.90 9506.12.00
8528.49.10 8601.10.00 9005.90.00 9506.19.00
8528.59.10 8601.20.00 9006.30.00 9506.21.00
8528.72.10 8602.10.00 9006.40.00 9506.29.10
8528.72.20 8602.90.00 9006.51.00 9506.29.20
8528.72.31 8603.10.00 9006.52.90 9506.31.00
8528.72.32 8603.90.00 9006.53.10 9506.32.00
8528.72.32 8605.00.00 9006.53.20 9506.40.00
8528.72.33 8606.10.00 9006.53.90 9507.10.00
8528.72.34 8606.30.00 9006.59.10 9507.30.00
8528.72.34 8606.91.10 9006.59.90 9508.10.00
8528.72.35 8606.91.90 9006.61.00 9601.10.00
8528.72.36 8606.92.00 9006.69.00 9601.90.10
8528.72.36 8606.99.00 9006.99.00 9601.90.90
8528.73.10 8607.11.00 9007.10.10 9602.00.90
8528.73.20 8703.10.11 9007.10.90 9614.00.00
8532.21.10 8703.10.19 9012.90.00 9704.00.00
8532.21.90 8703.10.21 9013.10.00 9705.00.00

Excise Duty under Excise Ordinance

Excise Duty under Excise Ordinance

1) Liquor
Alcohol volume based Excise Duty depending on the type of liquor will be introduced as follows:
i. Hard liquor – Rs. 3,300/- per litre of alcohol

ii. Beer – Rs.2,400 per litre of alcohol

iii. Wine – Rs.2,400 per litre of alcohol

2) Non-potable alcohol
Excise duty will be imposed on import of non-potable alcohol at Rs.15/- per Kg.

3) Raw material used for manufacturing of ethanol
Excise Duty will be imposed on raw materials used for manufacturing of ethanol to be as follows :
Type of raw material Proposed Duty (Rs.)
Toddy Rs.05/- per litre
Molasses/Maize/Rice/Fruits Rs.10/- per Kg

4) Liquor Licenses
Rate structure of Liquor license fee will be simplified w.e.f. 01/01/2018

5) Issuance of new liquor license will be simplified to promote tourism.

6) Changes to Excise Duty will be published by Gazette.

Excise (Special Provisions) Duty

Excise (Special Provisions) Duty

1) Canned Beer
Excise (Special Provisions) Duty applicable on canned beer will be removed.

2) Sugar tax on sweetened beverages
Excise duty based on the quantum of sugar contained will be introduced for the beverages with added sugar.

This duty applicable for beverages classified under HS Code 22.02

The rate will be 50 cts per gram of sugar

3) Plastic resin
Excise duty on plastic resin will be introduced at Rs.10 per Kg.

This duty will be applicable for items classified under the HS Codes 3901.10, 3901.20, 3902.10, 3903.11 and 3904.10

4) Motor vehicles
Ad-valorem rate of excise duty on motor vehicles will be removed

Excise duty will be applied based only on the Engine Capacity (cubic centimeter (cm3 )) for petrol and diesel motor vehicles

Excise duty base for electric vehicles will be the motor power of the engine (kilowatt (Kw))

The rate for Engine capacity based excise duty on petrol fuel & petrol hybrid motor cars are as follows.
Engine capacity Petrol fuel (Rs. Per cm3 ) Petrol hybrid (Rs. Per cm3 )
≤ 1000cm3 1,750 1,250

1000cm3 < x ≤ 1300 cm3 2,750 2,000 1300cm3 < x ≤ 1500 cm3 3,250 2,500 1500cm3 < x ≤ 1600 cm3 4,000 3,000 1600cm3 < x ≤ 1800 cm3 5,000 4,500 1800cm3 < x ≤ 2000 cm3 6,000 5,000 2000cm3 < x ≤ 2500 cm3 7,000 6,000 2500cm 3 < x ≤ 2750 cm3 8,000 7,000 2750cm3 < x ≤ 3000 cm3 9,000 8,000 3000cm3 < x ≤ 4000 cm3 10,000 9,000 4000 cm3 < 11,000 10,00 5) The rate for Engine capacity based excise duty on diesel fuel & diesel hybrid motor cars are as follows: Engine capacity Diesel fuel (Rs. Per cm3 ) Diesel hybrid (Rs. Per cm3) ≤ 1500cm3 4,000 3,000 1500cm3 < x ≤ 1600 cm3 5,000 4,000 1600cm3 < x ≤ 1800 cm3 6,000 5,000 1800cm3 < x ≤ 2000 cm3 7,000 6,000 2000cm3 < x ≤ 2500 cm3 8,000 7,000 2500cm3 < x ≤ 2750 cm3 9,000 8,000 2750cm3 < x ≤ 3000 cm3 10,000 9,000 3000cm3 < x ≤ 4000 cm3 11,000 10,000 4000 cm3 < 12,000 11,000 6) Duty rates for Electric vehicles are as follows: Motor power Unregistered (brand new) vehicle (Rs.Per kw) Used vehicle (Rs. Per kw) ≤ 50 Kw 7,500 15,000 50Kw < x ≤ 100 Kw 12,500 25,000 100 Kw < x ≤ 200 Kw 25,000 40,000 200 Kw 40,000 55,000 7) Duty rates for three wheelers are as follows: i. Petrol - Rs.2,100 per cm3 ii. Diesel - Rs.1,250 per cm3 iii. Electric Unregistered (brand new) - Rs.7,500 per Kw Registered (used) - Rs.10,000 per Kw 8) Applicable duty will be revised for off-road electric sports vehicles classified under HS Code 8703.10.11, 8703.10.19,8703.10.21, 8703.10.29 to facilitate promotion of sports tourism 9)Vehicle permits for public sector employees 10) Upper ceiling of excise duty concession of vehicle permits for public sector employees will be defined in rupee value without changing the existing concession rate. 11) Upper ceiling of CIF value of imported vehicles will be removed 12) Restriction on transferability will be removed

Carbon Tax

Carbon Tax

Carbon tax will be imposed on motor vehicles based on the engine capacity.

Rate will depend on age and fuel type of vehicle as follows:

Type of vehicle Less than 05 years 05 to 10 years Over 10 years

Hybrid
(Petrol/Diesel) 25 Cts per cm3 50 Cts per cm3 Rs.1.00 per cm3

Fuel
(Petrol/Diesel) 50 Cts per cm3 Rs.1.00 per cm3 Rs.1.50 per cm3

Passenger bus Rs.1,000/- Rs.2,000/- Rs.3,000/-

Electric vehicles are exempted from the levy

Debt Repayment Levy

Debt Repayment Levy

Debt Repayment Levy (DRL) will be introduced on cash transactions by financial institutions

Rate is Rs.2/- per Rs.10,000/- cash transaction (i.e. 0.02%)

Levy will be charged on total cash transactions and should be paid by the financial institutions.

Luxury Tax on Motor Vehicles

Luxury Tax on Motor Vehicles

1) One-time payment luxury tax will be introduced in lieu of the present system of payment over 7 years

2) The present system will be continued for the vehicles already registered

3) Tax depends on the band of engine capacity or motor power of the vehicle as follows:

Super Luxury (Rs.) Luxury (Rs.) SemiLuxury (Rs.)

Dual purpose (Petrol/diesel) 2200cm3 250,000/-

Motor Car
Petrol 1800cm3 < x ≤ 2500 cm3 Diesel 2200cm3 < x ≤ 3000 cm3 Electric 200 kW < x ≤ 300 kw 500,000/- Petrol 2500cm3 < x ≤ 3500 cm3 Diesel 3000cm3 < x ≤ 4000 cm3 Electric 300 kW < x ≤ 400 kw 1,000, 00/- Petrol 3500cm3 < Diesel 4000cm3 < Electric 500 kW < 2,000,000/-

Applicability for Different Sectors

1) Supporting the use of Solar Power:

Tax benefits
The NBT and PAL will be exempted on machines and equipment including solar panels and, storage batteries which will be imported for the establishment of solar charging stations.

2) Credit schemes
Individuals, companies incorporated under the Companies Act, No. 7 of 2007, co-operative societies, farmers/fisheries societies engaged in agriculture, agro processing including drip irrigation, poultry,
canning, plantation and tourism industry, that will invest in technology for the generation of solar power to be used for their own operations, will be supported through the introduction of a loan scheme at a subsidized interest rate of 8%.

Supporting the conversion from Non-Bio Degradable Polythene to environmentally friendly alternatives: ( Budget Proposal Nos. 23 and 24)

The Government will bear 50% of the investment cost incurred on equipment and machinery by SME polythene producers when converting from polythene to environment friendly alternatives.

A concessionary Green Loan Scheme will be introduced by the Pradeshiya Sanwardena Bank (also known as the Regional Development Bank) to encourage local entrepreneurs to engage in manufacturing bags, packing materials etc. out of bio degradable materials such as banana fiber, palm leaves, coir, and bamboo.

3) The “Pavithra Ganga” initiative:

The companies that already discharge their waste into the Kelani River, lagoons and estuaries will be:
 supported in the next 5 years to invest in technology to ensure zero discharge of waste into these water bodies .
 eligible to utilize the “E- Friends” credit facility at a concessionary interest rate of 6-8%.

The CEA will issue relevant regulations and will strictly monitor this process.

4) Supporting the SME companies:
The SME companies will be companies incorporated under the Companies Act, No. 7 of 2007 and will have at least 10 shareholders each contributing at least Rs.10,000 in equity. These companies could engage in any business from agriculture to apparels to IT.

The support provided by the Government will include:
 provision of equipment and facilities such as storage facilities, planting and seeding equipment, weed removers,
boats, fishing nets etc.

 extension of leasing facilities from the State banks to these companies to purchase such machinery.
 provision of a letter of undertaking or a guarantee to the respective State bank for the equipment, and other facilities purchased and, to bear at least 75% of the lease cost on behalf of the company during the lifetime of the lease.

 make available the “Enterprise Sri Lanka Credit Schemes” to these companies.

 provision of technical support to incorporate companies, maintain books and records, negotiations with financial
institutions will be provided by the private sector consultants. Each company incorporated under this mechanism will have a consultant company to support and the cost of the company for consultations for a period of 36
months will be borne by the Government in full, while for a period of another 24 months the Government will bear 50% of such cost. An incentive package based on the performance of these companies will be made available to these
consultants.

 bear the hire purchase lease rental and the interest subsidies by the Government.

These facilities by the Government will be 10% above the norm for companies headed by women.

The above facilities for companies headed by differently abled will be 15% above the norm.

Financial and non-financial support such as transfer of technical knowhow, packaging and marketing of products or services etc. will be coordinated and provided by the Department of Development Finance at the Ministry of Finance and Mass Media.

5) Supporting the startups and the innovation culture:

The “Erambuma” Credit Scheme

 University graduates with viable business ideas are eligible to utilize the “Erambuma” credit facility.
 The maximum loan size is Rs. 1.5 million per idea per person.
 The interest is 100% subsidized by the Government and the repayment is fully guaranteed through a Government
guarantee.

6) The “IT Initiative”
 The Government will finance the “IT Initiative” by providing Rs. 3 billion over a period of 3 years.
 This initiative will provide both financial and non-financial support by way of grants, equity investments, credit facilities, mentoring, technical support etc. to:

 local startups

 attract foreign startups

 Small and medium IT companies with a turnover around USD 2-3 million per annum to at least double
their revenue in 3 years.

 create the enabling environment by supporting establishment of Incubators, the acquisition and
augmentation of skills and know-how in collaboration with the local universities etc.

 The Government will facilitate effective collaboration between the Universities and the Industry in the following
manner.
 The IT industry to be able to acquire and augment the skills set in line with the demand in collaboration with
the University of Colombo (UoC) and Moratuwa (UoM) and, the SLIIT. For example, if an IT company requires training of its employees, non-employees including undergraduates of Universities or Technical Colleges, the company
could collaborate with UoC, UoM or the SLIIT to design the required courses. The “IT Initiative” will bear a portion of the cost while the company will bear the balance. Those who successfully complete such courses will be employed by the companies.
 This will be operated through the EDB and be managed by a Board comprising mainly of experienced private sector professionals, investors and entrepreneurs.

7) The “I2I Initiative”
 The “I2I” aims to connect university graduates and NVQ 4 certified graduates for a registered patent or a viable business idea with the industry. (Industry will adopt the Innovator).
 The Government will bear:
 the monthly salary, i.e., 50% up to a maximum of Rs.50,000 per month for a period of 24 months, and
 the cost of patenting in Sri Lanka and counsel on patenting

8) Export Access Programme:
We will introduce an “Export Market Access Support Programme” targeting the extension of support to:
 local companies that already have exports of less than USD 10 million per annum.
 potential new entrants to the export market to better access the global value chains.

This programme will facilitate:
 meeting of the cost of compliance which includes the cost of provision of free samples, intellectual property registration,insurance and promotional costs undertaken overseas.

 meeting of the full or partial cost of rent of retail shop space or shelf space occupied by domestic brands that reach overseas markets for a maximum period of 36 months.

Product development assistance to exporters to develop new products or improve existing products to meet the export market standards and financial support will be provided through the “Enterprise Sri Lanka” Credit schemes.

This programme will be implemented through the EDB.

9) Supporting Tourism:
Homestay Programme:
 A credit scheme will be introduced to support home owners registered with the SLTDA to upgrade their houses to meet the standards required to be in the Homestay programme.

 The facility under the scheme up to a maximum of Rs. 5 million per person at an interest rate of 6%, with a maturity period of 10 years will be introduced.

10) Employment Preparation Fund:
An “Employment Preparatory Fund” will be established under the Ministry of National Policies and Economic Development and will be operated through the National Youth Corps.

This fund will finance vocational training courses that are required by the private sector. The courses will be designed in collaboration with the private sector and such courses may be conducted at institutions such as Hotel Schools, Nursing Schools etc.

Most of these courses will be short termed with duration of 3-6 months and at the successful completion, employment will be guaranteed by the private sector.

This fund will be further utilized to:
 pay a stipend of Rs. 3,500 per month for those following training courses up to a maximum duration of 6 months, and
 finance the cost of the training course, in full or partly.

The Government will further incentivize the private sector to employ these youth who successfully follow these training programme(s) by bearing the cost of the salary of an employee up to Rs. 6,000 per month for a period of 6 months and the partner employer will pay a further allowance of Rs. 10,000 per month.

11) Supporting the middle income earner to be a home buyer:

A concessionary loan scheme will be introduced by the National Savings Bank to facilitate first time middle income home buyers.

The following terms and conditions will be applicable in this regard.

 Maximum loan size Rs. 5 million

 Interest rate 7% per annum

 Tenure 7 years