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

16.5 Refund of Input tax attributable to exports
As the exports are zero-rated an exporter will be entitled to recover the input tax
attributable to exports. That is the input tax included in the supplies used by him which
enabled him to make the export are set off against any output tax payable by him. If
there is no output tax the entire amount of input tax is refunded. He is thus able to make
the export without the incidence of VAT. Export of VAT exempt goods are also entitled to
zero-rating. Section 76 of the Act provides that input tax paid on the acquisition of goods
for the purpose of making an exempt supply shall be deemed to be an input tax if such
supply subsequently becomes a taxable supply. Thus the input tax attributable to supply
of goods used in making an export under any circumstances can be recovered by the
exporter.
16.6. Taxable Period of an Exporter
Taxable period of an exporter is one month provided 50% or more of his total taxable
supplies (including exports) are zero-rated supplies. Vide para 3.6. Such person should
furnish monthly returns unless he opts to file returns quarterly Sec. 83.
16.7 IMPORTS
i. Although what is meant by an exporter is not defined in the Act what is meant
by “importation” is defined to include
(a) (i). bringing of goods into Sri Lanka by any person or
(ii) goods received form Customs bonded area and
(b) purchase of goods on a sale by
(i) the D.G.C
(ii) Sri Lanka Ports Authority or
(iii) the C.G.I.R
for the levy of tax and other dues
iii. Bringing of a ship or an aircraft into Sri Lanka to be registered under the
necessary regulations in Sri Lanka amount to an importation of a ship or an
aircraft. The importation of a ship is excluded form VAT – Sec. 2(3)(e)
iv. VAT on importation of goods are charged and collected by the D.G.C as if it
were a Customs Duty and as if all the goods imported into Sri Lanka are dutiable
and liable to Customs Duty. Sec. 2.3. Thus VAT is chargeable even if the goods
are exempt from Customs Duty. Please see comments made in paras 5.1.2,
5.11 and 10.3
93