New tax calculation method provides relief to gem importers, Gem and Jewellery Authority says

By Mangala Pavithrani

Colombo, Jan. 19 (Daily Mirror) - A revised method for calculating the Social Security Contribution Levy (SSCL) and Value Added Tax (VAT) on gem imports has been introduced, offering significantly greater relief to gem importers, National Gem and Jewellery Authority (NGJA) Chairman and CEO Dr. S.B. Chaminda said.

Speaking at a media briefing today, Dr. Chaminda explained that following the introduction of SSCL and VAT on gem imports from January 1, 2024, gem imports sharply declined during 2024 and 2025 compared to 2023, negatively impacting gem exports as well.

"From January 2024, VAT was calculated based on the value of the gems in the imported parcel, with 18% VAT and 2.5% SSCL applied," he said. However, this method imposed a heavy tax burden on importers, discouraging activity in the sector.

To address this, authorities have introduced a simpler and more concessionary tax calculation system. Under the new reform, a specific value is assigned to imported gem parcels. For precious gemstones such as ruby, sapphire, and emerald, the value is estimated at USD 900 per kilogram. VAT and SSCL are then calculated based on this fixed price.

Dr. Chaminda illustrated: "For example, when a 1 kg parcel of gems valued at USD 900 is imported, the importer will be charged only USD 184.5 as VAT and SSCL, equivalent to Rs. 57,195 in Sri Lankan currency."

For semi-precious stones, including amethyst, topaz, and garnet, the value is set at USD 50 per kilogram, with the importer paying USD 10.25 in VAT and SSCL, approximately Rs. 3,200.

Highlighting the benefits of the new tax structure, Dr. Chaminda encouraged young entrepreneurs to enter the gem industry—particularly in importing, cutting, polishing, and re-exporting—to further strengthen Sri Lanka’s gem and jewellery sector.