The Inland Revenue says a new tax – the Economic Service Charge (ESC) – will be enforced on companies from next week. The Inland Revenue says a new tax – the Economic Service Charge (ESC) – will be enforced on companies from next week. “We will advertise for companies to pay next week,” said Commissioner of Inland Revenue, R P L Weerasinghe.
All companies operating for three years, with a turnover of Rs 50mn and above, will come within the new tax net for a one percent payment on turnover.
The tax, although proposed in the previous budget, got Parliamentary approval only last week but is effective in retrospective from April 1st 2004.
However at a pre-budget workshop, organised by the National Chamber of Industries, on Thursday, a grace period was promised for companies to pay up.
“We know it is difficult to pay up two quarters at once so we will give a grace period for the payments once they are called,” said Weerasinghe.
The ESC is looked at as an advanced income tax and can be set off against income tax payments for three years.
Although the original ESC tax intended targeting companie