No more tax on lease of land by foreigners

Land (Restrictions on Alienation) Amendment Act No. 3 of 2017 has been signed into law. 

The amendment essentially removes the tax which was payable on the lease of land by foreigners effective from 8 January 2017.

Previously a standard rate of 15% was applicable while there was a concessionary rate of 7.5% as well.

According to the amending act, Land Lease Tax will not apply to the lease of land to the following parties on any indenture of lease executed on or after 8 January 2017:

(a) A foreigner.

(b) A company incorporated in Sri Lanka under the Companies Act, where any foreign shareholding in such a company, either direct or indirect, is 50% or above.

(c) A foreign company.