Gazette on super gains tax, mansion tax reach final stages

March, 26, 2015

Preparation of the Gazette notifications on the ‘Super Gains Tax’ and the ‘Mansion Tax’ proposed by the new government through its interim budget are reportedly in their final stages and are to be released shortly.

Very reliable sources reveal that though work on the preparation of the bill and Gazette notification on the Super Gains Tax have been almost completed, the bill and Gazette notification on the Mansion Tax have not been finalized since there are certain issues to be resolved.

Strong opposition has already arisen from the business community against the Super Gains Tax imposed on companies through the new government’s interim budget.

While expressing his views, economic analyst Hasitha Premaratne told that this particular tax having a retrospective effect is an issue. This proposes a 25 per cent tax to be imposed on companies which have gained profits of over Rs. 02 billion during 2013-14.

Due to this tax, over 20 companies listed at the Colombo Stock Exchange are greatly affected a situation has arisen where telecommunication services providers are being taxed at both ends.

Since some of these companies have already paid a tax of 28 per cent, the added 25 per cent would be 53 per cent and hence this needs clarification, said Premaratne.

Meanwhile, the government has relaxed the tax regulations to enable the Mansion Tax to be paid in four installments.

According to the new amendments, the government has said a Rs. 01 million Mansion Tax will be imposed on houses valued at Rs. 150 million or 10,000 square feet floor area which have been built after 01 April 2000.

The interim budget expects a revenue of Rs. 01 billion through this tax.