Lankan expats encouraged to live and work here
Sri Lanka has changed its tax laws due to a number of Sri Lankans
living abroad expressing interest to work in Sri Lanka and avail
the country of their experience and knowledge, the National Council
for Economic Development (NCED) said in a statement.
former tax laws created a major problem as any person living and
working in Sri Lanka for more than 182 days in any tax year was
liable for taxation on their income in Sri Lanka as well as any
income gained abroad. "This created a financially unviable
situation as those people then had to pay tax on the income arising
from abroad as well as income earned in Sri Lanka which meant paying
tax twice on the same income as they would already be paying tax
for the income earned in those countries. Unravelling this through
provisions in double tax agreements was a hassle that most persons
were averse to," the NCED said.
amendments to the Income Tax Act have addressed this problem effectively.
The new rule is that a Sri Lankan with dual nationality will only
have to pay tax in Sri Lanka on income arising in Sri Lanka, regardless
of the number of days he/she spends in Sri Lanka. "It is anticipated
that this will result in many more Sri Lankans coming and working
for their country while also considering investing their wealth
in Sri Lanka," the statement said. A NCED spokesman said the
move gives effect to a proposal made in the last November budget.