[World Tax News] Sri Lanka proposes half-yearly tax computation for Year 2022-23 and more
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- Last Updated on 5 November, 2022
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Editorial Team – [2022] 144 taxmann.com 90 (Article)
World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week.
1. Sri Lanka proposes half-yearly tax computation for Year of Assessment 2022-23
The Sri Lankan Government has introduced the Inland Revenue (Amendment) Bill to amend the Income-tax laws. Some of the important changes proposed in the bill are as below:
(a) Income-tax payable by a resident and non-resident individuals of Sri Lanka for the Year of Assessment commencing from 1stApril 2022 shall be calculated in two parts of 6 months each. It would be calculated in the following manner:
-
-
- For the first 6 months of the year
-
| Taxable Income (In Srilankan Rupees) |
Tax payable |
| Upto Rs. 15,00,000 | 6% of taxable income |
| Rs. 15,00,000–30,00,000 | Rs. 90,000 + 12% of the amount above Rs. 15,00,000 |
| Above Rs. 30,00,000 | Rs. 270,000 + 18% of the amount above Rs. 30,00,000 |
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- For the second 6 months of the year
| Taxable Income (In Srilankan Rupees) |
Tax payable |
| Upto Rs. 2,50,000 | 6% of taxable income |
| Rs. 2,50,000 – Rs. 5,00,000 | Rs. 15,000 + 12% of the amount above Rs. 2,50,000 |
| Rs. 5,00,000 – Rs. 7,50,000 | Rs. 45,000 + 18% of the amount above Rs. 5,00,000 |
| Rs. 7,50,000 – 10,00,000 | Rs. 90,000 + 24% of the amount above Rs. 7,50,000 |
| Rs. 10,00,000 – 12,50,000 | Rs. 1,50,000 + 30% of the amount above Rs.10,00,000 |
| Above Rs. 12,50,000 | Rs. 2,25,000 + 36% of the amount above Rs. 12,50,000 |
(b) The exemption to non-residents from tax on dividends paid by a resident company is proposed to be withdrawn w.e.f. 01-10-2022.
(c) Advance Personal Income Tax (APIT) has been introduced, mandating every employer to deduct tax from payments made to employees beginning on 1stOctober 2022.
(d) Mandatory Advance Income Tax deduction/Withholding tax will be made on the payment of dividend, interest, discount, charge, natural resource payment, rent, royalty, or premium, which has a source in Sri Lanka.
(e) The concessional tax rate of 14% and 18% on identified gains and profits will not be applicable w.e.f. 01-10-2022.
(f) The tax rate on companies in respect of the capital gains arising from the realisation of investment assets has been increased from 10% to 30%.
(g) No loss can be reduced while calculating the capital gain arising from the sale of an asset.
(h) The exemption for the profits derived from providing information technology and enabled services has been revoked w.e.f. 01-04-2023.
Source: Official Gazette
2. Empty Homes Levy – Queensland (Australian State) introduces tax on Vacant Homes
Queensland introduced the Land Tax and Other Legislation (Empty Homes Levy) Amendment Bill, 2022.This bill is based on similar levies imposed in Canada, France, and Victoria. This initiative has been taken to bring the vacant houses back to the rental market.
The bill proposes to charge tax on homeowners having residential properties if such properties stay vacant for 6 months or more in a year. The investors will be charged at the rate of 5% on the capital-improved value of the residential property.
The levy is payable on 30thJune at the end of each financial year
Sources: Land Tax and Other Legislation (Empty Homes Levy) Amendment Bill 2022.
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