ACT, No. 12 OF 2015

12of2015.pdf
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PARLIAMENT OF THE DEMOCRATIC
SOCIALIST REPUBLIC OF
SRI LANKA
NATION BUILDING TAX (AMENDMENT)
ACT, No. 12 OF 2015
[Certified on 30th October, 2015]
Printed on the Order of Government
Published as a Supplement to Part II of the Gazette of the Democratic
Socialist Republic of Sri Lanka of October 30, 2015
PRINTEDATTHE DEPARTMENTOFGOVERNMENTPRINTING,SRILANKA
TO BEPURCHASED AT THE GOVERNMENT PUBLICATIONS BUREAU, COLOMBO 5
Price : Rs. 12.00 Postage : Rs. 30.00

Nation Building Tax (Amendment) 1
Act, No. 12 of 2015
[Certified on 30th October, 2015]
L.D.—O. 14/2015
ANACT TO AMEND THE NATION BUILDING TAX
ACT, NO. 9 OF 2009
BE it enacted by the Parliament of the Democratic Socialist
Republic of Sri Lanka as follows:-
1. (1) This Act may be cited as the Nation Building Tax Short title and
(Amendment) Act, No. 12 of 2015, and shall be deemed to date of
operation.
have come into operation from January 1, 2015, unless
different dates of operation are specified hereunder.
(2) The provisions of section 6B shall come into
operation on such date as the Minister may appoint by Order
published in the Gazette.
2. Section 3 of the Nation Building Tax Act, No. 9 of Amendment of
2009 (hereinafter referred to as the “principal enactment”) section 3 of
Act, No. 9 of
as last amended by Act, No. 10 of 2014 is hereby further
2009.
amended as follows:-
(1) in subsection (2) of that section –
(a) in paragraph (iii) thereof by the repeal of the
first proviso and substitution therefor of the
following:-
“Provided that, the liable turnover from the
supply of any financial service in Sri Lanka,
by any person carrying on the business of
providing financial services shall,
notwithstanding anything to the contrary in
any other provisions of this Act, be –
(a) for any quarter ending on or before
September 30, 2014 and the period
commencing on October 1, 2014 and
ending on October 24, 2014, the value
2—PL 009235—2,950 (09/2015)
2 Nation Building Tax (Amendment)
Act, No. 12 of 2015
addition attributable to such financial
service, calculated for the purposes of
applying the attributable method
referred to in subsection (4) read with
subsection (5) of section 25C of the
Value Added Tax Act, No. 14 of 2002,
for the payment of Value Added Tax
on the supply of financial services; and
(b) for the period commencing from
October 25, 2014 and ending on
December 31, 2014 and for any quarter
commencing on or after January 1,
2015, the value of supply referred to in
subsection (2) of section 25A of the
Value Added Tax Act, No. 14 of 2002:
Provided however, the value
addition attributable to such financial
services shall be computed for the
payment of tax on the business of
financial services for the purpose of this
Act by applying the attributable
method referred to in subsection (4)
read with subsection (5) of section 25C
of the Value Added Tax Act, No. 14 of
2002.”;
(b) by the insertion immediately after paragraph
(iii) thereof, the following new paragraph:-
“(iiiA) For the purposes of paragraph (iii),
with reference to any person referred to in
paragraph (c) of subsection (1) of section 2
arising from the business of real estate and
improvement thereon, means the value of that
service ascertained for the purpose of Value
Added Tax Act under subsection (7) of section
5 of the Value Added Tax Act, No. 14 of
Nation Building Tax (Amendment) 3
Act, No. 12 of 2015
2002, but does not include the value of any
excepted service referred to in PART II of the
First Schedule.”
(c) in paragraph (iv) of that subsection-
(i) by the substitution in subparagraph (9)
for the words “foreign currency; and”
of the words “foreign currency;”;
(ii) by the repeal of subparagraph (10) and
substitution therefor of the following
new subparagraphs:-
“(10) LP Gas;
(11) any motor vehicle identified
under Harmonized Commodity
Description and Coding Numbers for
Custom purposes and liable to Excise
Duty under the Excise (Special
Provisions) Act, No. 13 of 1989, on the
importation, including such motor
vehicles in the stock remain unsold as
at October 25, 2014 which would have
been otherwise liable to such Excise
duty on the importation, if they were
imported after October 25, 2014, insofar
as, such vehicles are sold by the
importer himself;
(12) cigarettes identified under
Harmonized Commodity Description
and Coding Numbers for Custom
purposes and liable to Excise Duty
under the Excise (Special Provisions)
Act, No. 13 of 1989 and Cess under Sri
Lanka Export Development Act, No. 40
of 1979, on the importation, including
4 Nation Building Tax (Amendment)
Act, No. 12 of 2015
cigarettes in the stocks remain unsold
as at October 25, 2014 which would
have been otherwise liable to such
Excise Duty and Cess on the
importation if they were imported after
October 25, 2014 insofar as, such
cigarettes are sold by the importer
himself.; and
(13) liquor identified under the
Harmonized Commodity Description
and Coding Numbers for Custom
purposes and liable to Custom Duty
under the Revenue Protection Act, No.
19 of 1962 and Cess under the Sri Lanka
Export Development Act, No. 40 of
1979 on the importation, including
liquor imported prior to October 25,
2014 in the stock remain unsold as at
October 25, 2014 which would have
been otherwise liable to such Custom
Duty and Cess on the importation, if
they were imported after October 25,
2014 insofar as, such liquor is sold by
the importer himself.”.
(2) in subsection (4) thereof, by the repeal of paragraph
(iii) and the substitution therefor of the following:-
“(iii) the liable turnover of such person from the
supply of any goods or services other than
services referred to in paragraph (iv) and
which does not exceed-
(a) the sum of five hundred thousand
rupees if such relevant quarter is any
quarter commencing on or after January
1, 2011 but prior to January 1, 2013;
Nation Building Tax (Amendment) 5
Act, No. 12 of 2015
(b) the sum of three million rupees if such
relevant quarter is any quarter
commencing on or after January 1, 2013
but prior to January 1, 2015; and
(c) the sum of three million seven hundred
and fifty thousand rupees if such relevant
quarter is any quarter commencing on or
after January 1, 2015;”.
3. Section 6 of the principal enactment as last amended Amendment of
by Act, No. 9 of 2012 is hereby further amended in the end section 6 of the
principal
of the proviso thereof, by the substitution for the words
enactment.
commencing from “for the quarter immediately” to the end
of that section, of the following:-
“for the quarter immediately succeeding that
relevant quarter:
Provided further, in no circumstance, the excess
shall be deemed to be an advance payment of tax
paid under section 4 by any person other than such
manufacturer and the set off shall not extend the
liability to tax on the turnover from the business of
manufacturing of any article.”.
4. The following new section is hereby inserted Insertion of new
immediately after section 6A of the principal enactment, section 6B in the
principal
and shall have effect as section 6B of that enactment:-
enactment.
“Use of 6B. The Minister may, on the
electronic recommendation of the Commissioner
communica-
General of Inland Revenue, make regulations
tions or
electronic for the purposes of authorizing or facilitating
records. the use of electronic communications or
electronic records for matters specified in
section 8 of the Electronic Transactions Act,
No. 19 of 2006.”.
6 Nation Building Tax (Amendment)
Act, No. 12 of 2015
Amendment of 5. Section 10 of the principal enactment as last amended
section 10 of the
principal by Act, No.10 of 2011, is further amended, by the repeal of
enactment. the definition of expression “service” and substitution
therefor of the following new definition:-
““service” includes any business of real estate and
improvement thereon; and”.
Amendment of 6. The First Schedule to the principal enactment as last
First Schedule to
amended by Act, No. 10 of 2014, is hereby amended as
the principal
enactment. follows:-
(1) In PART I of that Schedule:-
(a) by the substitution for item (xxvi) thereof, of
the following new item:-
“(xxvi) samples imported in relation to a
business worth not more than-
(a) rupees twenty five thousand,
where such samples were
imported prior to January 1,
2015; and
(b) rupees fifty thousand where
such samples are imported on
or after January 1, 2015:
subject to such terms and conditions
as may be set out by the Director-
General of Customs;”;
(b) by the substitution for the item (XLV) thereof,
of the following new item:-
Nation Building Tax (Amendment) 7
Act, No. 12 of 2015
“(XLV) any machinery or equipment
imported or purchased locally for the
purpose of generating electricity by
the Ceylon Electricity Board
established under the Ceylon
Electricity Board Act, No. 17 of 1969
or any institution which has entered
into an agreement with the Ceylon
Electricity Board to supply
electricity, being machinery or
equipment classified under
Harmonized Commodity
Description Coding Numbers for
Customs purposes and approved by
the Minister of Finance;”;
(c) by the substitution in item (XLVI), for the
words, “commencing from January 1, 2014.”
of the words “commencing from January 1,
2014;”;and
(d) by the insertion immediately after item
(XLVI), of the following new items :-
“(XLVII) any machinery, equipment or spare
parts imported by Sri Lanka Ports
Authority to be used exclusively
within its ports;
(XLVIII) any motor vehicle identified under
Harmonized Commodity
Description and Coding Numbers for
Custom purposes and liable to
Excise duty under the Excise
(Special Provisions) Act, No. 13 of
1989, on the importation or any
motor vehicle liable to the same
Duty on manufacture of any such
vehicle, including such
8 Nation Building Tax (Amendment)
Act, No. 12 of 2015
manufactured motor vehicles remain
unsold in the stock which would
have been otherwise liable to the
same Duty if the same is
manufactured after October 25, 2014;
(XLIX) cigarettes identified under the
Harmonized Commodity Description
and Coding Numbers for Custom
purposes and liable to Excise Duty
under the Excise (Special Provisions)
Act, No. 13 of 1989 and Cess under
Sri Lanka Export Development Act,
No. 40 of 1979 on the importation or
on the manufacture of the same, as
the case may be, including such
manufactured cigarettes in stock
remain unsold as at October 25, 2014
which would have been otherwise
liable to the same Duty on
manufacture, if the same is
manufactured after October 25, 2014;
and
(L) liquor identified under the
Harmonized Commodity Description
and Coding Numbers for Custom
purposes and liable to Custom Duty
under the Revenue Protection Act,
No.19 of 1962 and Cess under Sri
Lanka Export Development Act, No.
40 of 1979 on the importation, or
Excise Duty under the Excise
Ordinance (Chapter 52) on the
manufacture, as the case may be,
including such manufactured liquor
in the stock remain unsold as at
October 25, 2014, which would have
been otherwise liable to the same
Duty, if manufactured after October
25, 2014.”.
Nation Building Tax (Amendment) 9
Act, No. 12 of 2015
(2) in PART II of that Schedule:-
(a) by the substitution for item (vi) thereof, of
the following new item:-
“(vi) the provision of finance leasing
facilities in respect of any movable
property on any financial leasing
agreement entered into prior to October
25, 2014;”;
(b) by the substitution for the item (vii) thereof,
of the following new item:-
“(vii) service-
(a) prior to January 1, 2011, of a
construction contractor, not
being a subcontractor; or
(b) on or after January 1, 2011, of a
construction contractor or
subcontractor,
insofar as such services are in respect of
constructing any building, road, bridge, water
supply, drainage or sewerage system, harbour,
airport or any infrastructure project in
telecommunication or electricity;”;
(c) by the substitution for the item (xiii) thereof,
of the following new item:-
“(xiii) the services of an auctioneer, broker,
insurance agent or commission agent
of any local produce to the extent of
the brokerage receivable by such
auctioneer or broker or commission
receivable by such insurance agent or
commission agent, as the case may be;”;
10 Nation Building Tax (Amendment)
Act, No. 12 of 2015
(d) by the substitution for the item (xxviii)
thereof, of the following new item:-
“(xxviii) telecommunication services
liable to the telecommunication
levy under the
Telecommunication Levy Act,
No. 21 of 2011, and the services
specially excluded from such
liability in defining the
telecommunication services in
that Act (effective from January
1, 2014)”;
(e) by the substitution in item (xxxvi) for the
words, “of the Government; and”, of the words
“of the Government;”;
(f) by the substitution in item (xxxvii) for the
words, “for payment in foreign currency.”, of
the words “for payment in foreign currency;
and”; and
(g) by the addition immediately after item
(xxxvii) of the following new item:-
“(xxxviii) The business of real estate and
improvement thereon, being
construction and sale of
residential accommodation, in so
far as the value of the
construction project relating to
the supply of such residential
accommodation is less than ten
million United States dollars or
its equivalent in any other
currency”.
Nation Building Tax (Amendment) 11
Act, No. 12 of 2015
7. Paragraphs (11), (12) and (13) of section 3 (2) (iv) Retrospective
and items (XLVIII), (XLIX) and (XLX) of the PART I of the effect.
First Schedule shall be deemed, for all purposes, to have
come into force on October 25, 2014, and item (xxviii) of
the PART II of the First Schedule shall deemed to have come
into effect from January 1, 2014.
8. Where the Commissioner-General of Inland Revenue Validation.
or the Director-General of Customs as the case may be,
collects under the provisions of section 4 or section 5
respectively, of the principal enactment, the tax calculated
considering the provisions of this Act, during the period
commencing from January 1, 2015 and ending on the date
on which the certificate of the Speaker is endorsed in respect
of this Act from a person to whom the provisions of this Act
applies, such collection shall be deemed for all purposes to
have been, and to be validly made:
Provided that, the aforesaid provisions of this section
shall not affect any decision or order made by any court or
any proceeding pending in any court in respect of any tax
collected during the aforesaid period.
9. In the event of any inconsistency between the Sinhala Sinhala text to
and Tamil texts of this Act, the Sinhala text shall prevail. prevail in case of
an inconsistency.

12 Nation Building Tax (Amendment)
Act, No. 12 of 2015
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