Sri Lanka cuts VAT from 12% to 11% 2015

Update January 2015 - this rise has not been passed.

The Sri Lankan government has announced a reduction in VAT in 2015 from 12% to 11%. The proposed cut came as part of a range of political give aways ahead of next year’s elections.

The VAT registration threshold will also be raised at the same time to LKR 15m per year.

Aside from the reduction in indirect tax, there will also be boosts to employee retirement funds at the expense of employers.