ECONOMYNEXT – Sri Lankan government revenue generated from corporate and non-corporate income tax fell marginally by 1.3 percent to Rs. 81.2 billion in the eight months to August 2017 from a year ago, according to the finance ministry.
This was owing to policy changes made to the Economic Service Charge (ESC) which can be set off against Income tax, according to the finance ministry’s Fiscal Management Report – 2018.
The revenue from ESC increased by 181.7 percent to Rs. 31.2 billion in the first eight months of 2017 from Rs. 11.1 billion income generated in the same period of 2016.
The increase in revenue from ESC reflected the revision of ESC policy removing exemption on the turnover of any profitable business of which the profit is subject to income tax and decreased ESC threshold.