IMF, Sri Lanka agree to amend personal tax rates

The International Monetary Fund (IMF) and the Sri Lankan government have agreed to amend the pay-as-you-earn (PAYE) tax system, as announced by President Ranil Wickremesinghe on Wednesday.

At a presidential election rally in Sabaragamuwa province, Wickremesinghe disclosed that both the government and the IMF have proposed separate amendments to the tax system. The final details will be revealed once a consensus is reached.

In response to the 2022 economic crisis, Sri Lanka modified its tax laws, exempting individuals earning less than 100,000 rupees (approximately $330) per month from the PAYE tax and imposing an 18 per cent value-added tax (VAT) on goods and services.

Since these new laws took effect in 2023, there have been ongoing demands from Sri Lankan professionals for tax relief.

Attribution: Xinhua News Agency

Subediting: M. S. Salama