The Government is considering two tax proposals in its efforts to amend the personal income tax structure, President Ranil Wickremesinghe said.
Stating that the Government is currently looking at making adjustments to the tax thresholds, intending to provide relief to taxpayers, the President said that Sri Lanka is currently entertaining two proposals.
“We are now in the next stage of discussing tax thresholds. We have had a strong economic performance this year and hope to maintain it next year. We are considering adjustments to the personal income tax structure to provide relief to taxpayers,” the President said.
The first proposal has been put forward by the Treasury, while a counter proposal has also been tabled by the International Monetary Fund (IMF), the President revealed.
“The Treasury’s proposal maintains a tax-free threshold of Rs. 1.2 million, widens the tax band from Rs. 500,000 to 720,000, and keeps the top tax rate at 36%,” President Wickremesinghe detailed.
The counter proposal by the IMF proposes that the tax-free threshold remains at Rs. 1.2 million as well, the President said. “But the first tax band is widened from Rs. 500,000 to 1 million rupees, shifting all tax bands up by 500,000 rupees, with subsequent bands remaining at Rs. 500,000 rupees and the top tax rate remains at 36%,” he said.
“We are evaluating these proposals and working towards one that provides relief,” he added.
President Wickremesinghe stated that he is considering the IMF proposal, but the final decision will be based on what is best for the country and its people.
The President made these remarks delivering the keynote address at the University Lecturers’ Conference held in Colombo on Wednesday. (Newswire)
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