VAT Guide to Value Added Tax - sri lanka inland revenue ...

The period within which the Board of Review should give a determination on an appeal will also
be restricted to two years.
11. Recovery Proceedings – Sec. 48
Recovery proceedings to be initiated within 5 years.
12. Refunds – Sec.58
Application to be made within 3 years.
13. Definition of Goods – Sec. 83
Will be amended to fall in line with the administrative ruling given in example 3 of para 3.3 of this
brochure.
14. Exemptions – Schedule 1
Item xxvi – exemption of medical and dental equipments and ambulances etc. is withdrawn and
will be taxed at 10%.
15. Hire-purchase of second land goods
Item (xi)(h) of the exemption list will be amended to clarify the position that hier-purchase of
second hand goods will be exempted from VAT as mentioned in para 17.2.
16. Lower rate 10% - Schedule 2
Item xviii - will be amended so that any leasing advance and any payment made for early
settlement of a lease to acquire the asset if the amount exceeds 10% of the total payable under
the agreement will not be considered as leasing payments (Please see para 18.15) Any initial
payment which cannot be set off against subsequent installments is an advance for this purpose.
Item xx – MICE tourism will be taxed at 10%. (This will give effect to para 26.6).
Items xxii to xxvii - supply and import of, textile and hand loom products, ships, jewellery, maize
and medical equipments etc will be brought under 10% category.
178