CB says 5-pct tax to be deducted from NRFC interest payments

Sep 27, 2017 (LBO) – Sri Lanka’s Central Bank on Wednesday confirmed that under the new Inland Revenue Act, a 5 percent With Holding Tax (WHT) should be deducted from the interest paid on all NRFC deposits.

The confirmation is related to the taxation of interest income on the Non-Resident Foreign Currency (NRFC) accounts in the new Inland Revenue Act.

On September 7, Island’s new revenue law passed in Parliament with the bill receiving 90 votes in favour while 25 votes against. Implementation date of the Inland Revenue Act has been postponed to 1st April 2018.

Certain political parties, however, charged that over 300 tax concessions have been removed from the new Act and over 100 amendments were included at the committee stage abruptly.