The Government has introduced a number of tax concessions to protect small and medium enterprises (SMEs) in the wake of COVID-19’s impact on the country’s economy, Cabinet Spokesman and Higher Education, Technology, Innovation and Information and Mass Media Minister Dr. Bandula Gunawardana revealed.
The Government has identified the need of implementing tax administration measures to ease the burden of the SMEs by providing them adequate opportunity to resume and operate their businesses. Accordingly, at the meeting held on June 3, 2020, the Cabinet of Ministers decided to exempt all forms of tax penalties during the period when the country was closed due to COVID-19 and to initiate the imposition of such fines from July 2020.
The Prime Minister in his capacity as Finance Minister has presented proposals to provide following concessions to the SME community in addition to the above and to amend the relevant legal provisions for this purpose. Provisions to implement such concessions promptly until the legal provisions come in to force are also included in the proposals. Cabinet approval has been granted to these proposals in June 24, 2020, the minister added.
If the Commissioner General of Inland Revenue is satisfied that there has been no intentional evasion of tax, exemption of arrears tax that payable on assessment issued up to the assessment year 2018/2019.
Non-issuance of additional assessments concerning SMEs whose income tax returns for the assessment year 2018/2019 have been submitted and paid.
Extension of the period granted for the payment of bank guarantee or non-refundable payment when submitting an appeal to the Tax Appeal Commission.
A grace period is provided to pay outstanding/defaulted taxes that have already been agreed with the Department of Inland Revenue.