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Cabinet approves decision to hike VAT to 18%

31 October 2023 12:08 pm - 24     - {{hitsCtrl.values.hits}}

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Cabinet approval has been granted to increase Value-Added Tax (VAT) to 18 percent from the current 15 percent with effect from January 1, 2024, Cabinet Spokesperson Minister Bandula Gunawardana said a while ago.

He said even though tax income has risen over 50 percent in the first nine months of 2023 compared to 2022, such income has not yet reached the targets set by the International Monetary Fund (IMF).

“Sri Lanka so far hasn’t got the second IMF tranche because we couldn’t meet the revenue targets set by the IMF,” Gunawardana said, explaining the rationale behind the Cabinet’s decision to approve the VAT increased proposed by the President Ranil Wickremesinghe in his capacity as the Minister of Finance.

The Department of Government Information has announced that, in addition to raising the VAT rate, the new rate will also be applied to specific goods and services that were previously exempt from VAT.

 

 

 

 

 

 


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  Comments - 24

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  • Joshua Tuesday, 31 October 2023 12:28 PM

    Have these morons gone mad? The prices are going to go up and the income levels are the same or low. These 225 don't pay a cent but put us on to trouble. So.much for the people who wanted imf

    Bando Tuesday, 31 October 2023 12:48 PM

    What happened to the GARLIC robbery? Were the crooks caught and punished?

    Bando Tuesday, 31 October 2023 12:48 PM

    What happened to the GARLIC robbery? Were the crooks caught and punished?

    Karalasingam Sivalingam Tuesday, 31 October 2023 12:59 PM

    VAT increase is going to hit everyone, poor will become poorer, rich will become richer, middle-class will vanish, infants, children and the elderly face malnutrition.

    Amaran Tuesday, 31 October 2023 12:59 PM

    Instead of increasing the REVENUE through tax, why cannot you all REDUCE THE EXPENSES. Reduce cabinet. Reduce perks given to Fmr Presidents, Eliminate corruption, Reduce wastage, etc.

    Gune Tuesday, 31 October 2023 01:10 PM

    What about the most important thing - recovery of stolen funds and prosecution of corrupt MPs and public servants? That will be enough forc10 generations. Not ready to do that?

    Nimal Tuesday, 31 October 2023 01:25 PM

    Very soon this tax will reach 100% under this sordid regime.

    SENIOR CITIZEN Tuesday, 31 October 2023 01:30 PM

    PLEASE INCREASE THE FD RATES FOR SENIOR CITIZENS AS WELL ... THE RATES ARE SO VERY LOW WE CAN HARDLY MANAGE OUR MONTHLY EXPENSES .... WE ARE SUFFERING TODAY ....HELP US TOO

    SENIOR CITIZEN Tuesday, 31 October 2023 01:31 PM

    HIKE THE FD RATES FOR SENIOR CITIZENS ALSO

    Gamaya Tuesday, 31 October 2023 01:35 PM

    Now the opportunistic fellows will come and say you bought RW to power for this, we reduced VAT blah blah. As someone said the IMF should tell the government to bring government spending under control. Make the state sector including ministers to pay taxes and no exemptions are given to anyone. Ministers should declare there assets including family owned etc.

    Dee Tuesday, 31 October 2023 01:37 PM

    With effect from midnight today- all goods and services (even those where vat don’t apply) will be increased by 18%

    Premalal Perera Tuesday, 31 October 2023 02:00 PM

    This country will be unlivable soon.

    Ram Tuesday, 31 October 2023 02:05 PM

    IMF promised only USD 2.9 Billion and that too in instalments. We have come some distance without it and with the help of Forex coming from our work force overseas. We have managed it fairly well curtailing on imports. At this time why burden the people with further taxes? Parliamentarians made no contribution. Make them to forego their perks, and security. That will give further savings. Stop foreign travel given to MPs as bribes. Then the increase in the Vat can be 16% and not 18%

    This is reality Tuesday, 31 October 2023 02:16 PM

    This is ....... INSANE !!! Cabinet = IMF = HMV (his master's voice)

    VJ Tuesday, 31 October 2023 02:45 PM

    What will people get in return for the increased VAT?

    mahesh J Tuesday, 31 October 2023 02:46 PM

    good news folks ! We need to pay our money to coverup - loss making government entities such as sri lankan airline and railway , CTB , CPC - pay off unwanted inefficient government servants

    SLEx Tuesday, 31 October 2023 02:47 PM

    Reason for these tax hikes is due to the people capable of paying taxes not paying them. Maybe start asking people you know to pay their fair share to the government so that the Govt. can increase their income without burdening the whole population. And before you say everyone pays their taxes, that is complete BS. Only 400,000 tax payers are there currently. You expect the tax earned from that 2% of the population to be able to support the rest of the population with social security, free education and free medicine? Has common sense gone out the window? No point of complaining. We either do one or the other to ensure the country does not go bankrupt again.

    N V Jen Tuesday, 31 October 2023 03:02 PM

    Electricity rates increased thru the roof, now VAT, Wealth tax in the offing, yet no efforts to curtail income leakage from Customs, Inland revenue and excise departments. No attempts to curtail wasteful govt. expenditure or rampant corruption. Only focused on taking away whatever the poor have. Land like no other.

    sam Tuesday, 31 October 2023 03:40 PM

    VAT does not apply to politicians as their spending is by the people or from the loot.

    Dorathy Sadananthan Tuesday, 31 October 2023 03:42 PM

    These Pin Bathas have no option but to raise the hand! They will steal public funds following Myna! Bribes following Kaputa! Foreign investments following Gobbaya or GoRa! Poorman water and water!

    Nihal S Tuesday, 31 October 2023 03:57 PM

    why not reduce expenses to meet the target; eg. reduce the mega size cabinet, get rid of the corruptions

    joshua Tuesday, 31 October 2023 08:46 PM

    SLPP and UNP don't come asking for votes. We will show you how it is done

    Kandiah Balendran Tuesday, 31 October 2023 09:06 PM

    Reduce the overstaffed government sector by at least 50%

    Sambo Monday, 06 November 2023 07:37 PM

    I think this cabinet is filled with ministers who are def, blind and dumb. They will pass anything for their survival for a few more months.


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