Sept 13, 2016 (LBO) – Sri Lanka’s Cabinet has approved the VAT increase in principle as required by the Supreme Court judgment, State Finance Minister Lakshman Yapa Abeywardena said.
The Supreme Court issued an interim order in July preventing the government from implementing the 4 percent VAT increase until the consent of the cabinet and Parliament is taken.
“Today, the cabinet has approved the VAT increase in principle as required by the Supreme Court,” Abeywardena told LBO.
Abeywardena said the government will decide whether to bring these amendments before the budget or with the budget proposals by tomorrow.
The budget for 2017 is scheduled to be presented in mid-November.
“These amendments will also include several SLFP proposals and other proposals.”
The SLFP recently proposed to increase the threshold for the VAT liability of wholesale and retail trade and to recover that income from the Nation Building Tax.
As per the previous draft Bill the threshold for the VAT liability of wholesale and retail trade was proposed to be reduced to 3 million rupees per quarter.