VAT Exemptions Announced for Milk, Yogurt, and Naphtha
Aruna Shantha
17-Apr-2025 12:27:56
The Inland Revenue Department (IRD) has announced key changes under the newly enacted Value Added Tax (Amendment) Bill. Effective April 11, locally produced liquid milk and yogurt are now exempt from VAT, provided the products contain at least 50% fresh milk.
Additionally, VAT has been removed on naphtha supplied by the Ceylon Petroleum Corporation (CPC) to the Ceylon Electricity Board (CEB) for electricity generation.
In a move to align with global tax practices, the IRD will impose VAT on digital services provided by non-resident entities to Sri Lankan consumers starting October 1.
The department also stated that all commercial importers and exporters must now register under the revised VAT system.
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