Taxation in Sri Lanka - Institute of Policy Studies of …

INSTITUTE OF POLICY STUDIES OF SRI LANKA

Working Paper Series

No.

25

Taxation in Sri Lanka:Current Trends and Perspectives

D. D. M. WAIDYASEKERA

Table of Contents

List of Tables List of Charts Acronyms Acknowledgement Executive Summary

Introduction

1.

Functions of a Tax System

2.

Economic Background

2.1 International

2.2 National

3.

Declining Trend of Tax Revenue/GDP Ratio

4.

Reasons for the Decline

5.

Composition of Tax Revenue ? Direct and Indirect

6.

Fiscal and Tax Incentives

7.

Elasticity and Buoyancy of the Tax System

8.

Taxation, Savings and Capital Formation

9.

Tax Base and Coverage`

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9.2DedDuDecdetudibcultceitbiElbexlpeEexEnpxsepenessnfesosersfAofsrosrAeAssssesasebslaesbaIlbnelceIonImcnocemomee

10.

Tax Rates

10.1 Corporate

10.2 Personal

10.3 Professionals

10.4 Flat Rate

10.5 Current Changes

10.6 The Laffer Curve

10.7 Relevant Reforms

11.

Provincial and Local Government Revenue

12.

Capital Gains Taxation

13.

Tax Evasion

13.1 Tax Avoidance

13.2 Withholding Taxes

13.3 Tax Amnesties

14.

The VAT Debate

14.1 Threshold

14.2 Exemptions

14.3 Zero Rating

14.4 Rates

14.5 Financial Services

14.6 Wholesale and Retail Trade

14.7 VAT Frauds

14.8 Administration

15.

Customs Duties, Excises and Miscellaneous Taxes and Levies

15.1 Tariffs

15.2 Excise Duties

15.3 Miscellaneous Taxes and Levies

15.4 Simplification

16.

Revenue Administration

16.1 Number of Taxpayers and Files

16.2 Compliance

16.3 Audits and Investigations

16.4 Default Taxes

16.5 Appeals

16.6 Coordination between Revenue Departments

16.7 Cost of Administration

16.8 Measures Taken for Improvement

17.

Concluding Remarks

References

Taxation in Sri Lanka : Current Trends and Perspectives

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