ACT, No. 11 OF 2011

11of2011.pdf
NadunReplacecont

PARLIAMENT OF THE DEMOCRATIC
SOCIALIST REPUBLIC OF
SRI LANKA
ECONOMIC SERVICE CHARGE
(AMENDMENT) ACT, No. 11 OF 2011
[Certified on 31st March, 2011]
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 April 01, 2011
PRINTEDAT THE DEPARTMENTOFGOVERNMENT PRINTING, SRILANKA
TO BEPURCHASED AT THEGOVERNMENT PUBLICATIONSBUREAU, COLOMBO 5
Price : Rs. 6.00 Postage : Rs. 10.00

Economic Service Charge (Amendment) 1
Act, No. 11 of 2011
[Certified on 31st March, 2011]
L.D.—O. 11/2011.
ANACT TO AMEND THE ECONOMIC SERVICE CHARGE
ACT, NO. 13 OF 2006
BE it enacted by the Parliament of the Democratic Socialist
Republic of Sri Lanka as follows :—
1. This Act may be cited as the Economic Service Short title.
Charge (Amendment) Act, No. 11 of 2011.
2. The Economic Service Charge Act, No. 13 of 2006 Amendment of
(hereinafter referred to as the “principal enactment”) is hereby section 2 of the
Economic
amended in section 2 as follows:—
Service Charge
Act, No. 13 of
(1) by the substitution for paragraph (a) and (b) of
2006.
subsecion (2) thereof, of the following—
“(a) commencing before March 31, 2007, does not
exceed ten million;
(b) commencing on or after April 1, 2007, but
before April 1, 2011, does not exceed rupees
seven million five hundred thousand;
(c) commencing on or after April 1, 2011, does
not exceed rupees twenty-five million.”; and
(2) by the substitution for the word “Schedule” in
subsection 1 of that section the words “Schedule I”
or “Schedule II” as the case may be of the words
“First Schedule”.
3. Section 7 of the principal enactment is hereby Amendment of
amended as follows :— section 7 of the
principal
“(1) by the re-numbering of that section as subsection enactment.
(1) thereof;
(2) in the re-numbered subsection (1), by the substitution
for the words “for any relevant quarter shall,” of the
words and figures “for any relevant quarter ending
on or before March 31, 2011 shall,”; and
2—PL 005581—4,040 (03/2011)
2 Economic Service Charge (Amendment)
Act, No. 11 of 2011
(3) by the addition immediately after the re-numbered
subsection (1) of the following new subsecion:—
“(2) Every person and partnership chargeable
with the service charge for any relevant quarter
commencing on or after April 1, 2011 shall,
whether or not requested by an Assessor to do so,
furnish to an Assessor, on or before the twentieth
day of April of each year, a return for the year of
assessment ending on March 31 of that year, in
such form and containing such particulars as may
be specified by the Commissioner-General, of the
relevent turnover of such person or partnership,
as the case may be. The return shall also indicate
the basis of the calculation of the service charge
and other details, if any, specified by the
Commissioner-General in relation to this
section.”.
Insertion of new 4. The following new section is hereby inserted
section 10A in immediately after section 10 of the principal enactment and
the principal
shall have effect as section 10A of that enactment :—
enactment.
“Turnover 10A. (1) The turnover from the business of
from Islamic any Islamic Financial Transaction shall be
Financial
chargeable to tax in terms of the provisions of
Transactions
to be this Act.
chargeable to
tax. (2) The Commissioner-General of Inland
Revenue shall in order to determine the extent
of liability to tax of any particular Islamic
Financial Transaction, issue from time to time,
such rules and guidelines as may be required
for the purpose of—
(a) identifying the circumstances which
would amount to an Islamic Financial
Transaction ; and
(b) ascertaining the profit and income
arising out of any Islamic Financial
Transaction.”.
Economic Service Charge (Amendment) 3
Act, No. 11 of 2011
5. Section 13 of the principal enactment is hereby Amendment of
amended by the substitution for the definition of the section 13 of the
principal
expression “person” of the following definition :— enactment.
“person” includes a company or body of persons, but
does not include—
(a) any registered society, within the meaning of
the Co-operative Societies Law, No. 5 of 1972
or under the respective Statute enacted by a
Provincial Council providing for such
registration;
(b) any person carrying on business as an owner or
charterer of an aircraft or ship;
(c) any government institution or local authority as
defined in the Inland Revenue Act, No. 10 of
2006;
(d) any distributor;
(e) any dealer in a lottery;
(f) any Unit Trust or Mutual Fund.”.
6. The Schedule to the principal enactment is hereby Amendment of
amended by the substitution for the word “Schedule” of the the Schedule to
the principal
following:— enactment.
“SCHEDULE I
For the period ending on March 31, 2011”; and
7. The following new Schedule is hereby inserted Replacement of
the Schedule to
immediately after Schedule I of the principal enactment and
the principal
shall have effect as Schedule II of that enactment:— enactment.

4 Economic Service Charge (Amendment)
Act, No. 11 of 2011
“SCHEDULE II (Section 2)
For the period commencing on April 1, 2011
PART OF THE LIABLE TURNOVER RATE OF THE
SERVICE CHARGE
APPLICABLE TO
THAT PART
1. Enterprises to which the Board of
Investment of Sri Lanka Law, No. 4 of
1978 is applicable (liable to pay income
tax)—
(a) Apparel exporters;
(b) Board of Investment houses;
0.1 per centum
(c) Manufacturers of textiles for
apparel exporters.
2. Persons granted Exemptions/
Concessionary Rates/Others
(a) who are exempt from income tax
(including tax holiday companies);
(b) who during certain periods are
incurring losses;
(c) who are subject to tax under
concessionary rates;
(d) who are engaged in wholesale or
retail trade other than products
manufactured or produced by the 0.25 per centum
seller (excepting distributors or
dealers in motor vehicles or liquor);
(e) who carry out primary conversion
of any tea, rubber or coconut
plantation including desiccated
coconut, coconut oil or fiber, copra
and sheet rubber, but excluding any
conversion which produces any
alcoholic beverage.
3. Advertising Agents—
(a) prior to April 1, 2011 1.0 per centum
(b) on or after April 1, 2011 0.25 per centum
4. any other businesses including of
which the turnover is defined by
Notice published in the Gazette. 1.0 per centum
(including dealers in motor vehicles,
liquor, tobacco and petroleum)”
Economic Service Charge (Amendment) 5
Act, No. 11 of 2011
8. Any person or partnership carrying on an enterprise, Exemption of
having an annual turnover of a sum not exceeding rupees certain small and
medium
one hundred million who is liable to pay the economic
enterprises from
service charge under this Act, who has defaulted in the the payment of
payment of such economic service charge as is payable by taxes payable by
him under this Act in respect of any year of assessment them.
ending on or before December 31, 2010, due to the existence
generally of any conflict environment or due to any financial
constraints of such person or partnership, shall be exempt
from the payment of such charge as is in default under this
Act :
Provided that, the Commissioner-General of Inland
Revenue shall on a request made in that behalf, issue to such
person or partnership a Certificate of Exemption in respect
of the sum in default :
Provided further, the person or partnership to whom the
Certificate of Exemption is issued, shall simultaneously
forward to the Commissioner-General of Inland Revenue a
written assurance to the effect that such person or partnership
will be responsible for the payment of all sums which may
become payable by him under this Act, in respect of any
future year of assessment commencing on or after January 1,
2011.
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.

6 Economic Service Charge (Amendment)
Act, No. 11 of 2011
Annual subscription of English Bills and Acts of the Parliament Rs. 885 (Local), Rs. 1,180
(Foreign), Payable to the SUPERINTENDENT, GOVERNMENT PUBLICATIONS BUREAU, DEPARTMENT OF
GOVERNMENT INFORMATION, NO. 163, KIRULAPONA MAWATHA, POLHENGODA, COLOMBO 05 before 15th
December each year in respect of the year following.
NadunReplacecontEnd