Thursday Mar 05, 2026
Thursday Mar 05, 2026
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A Bill to amend the Social Security Contribution Levy (SSCL) Act No. 25 of 2022 has been gazetted following the Budget 2026 proposals, introducing several changes including a lower registration threshold and revisions to the levy treatment on motor vehicles, according to a briefing by KPMG Sri Lanka.
The Bill was published in the Gazette Extraordinary dated 27 February 2026 and issued on 3 March 2026 by the Minister of Finance, Planning and Economic Development.
Under the proposed amendments, the threshold requiring businesses to register for the SSCL will be reduced with effect from 1 April 2026. The quarterly turnover threshold will decline to Rs. 9 million from the current Rs. 15 million, while the annual threshold based on four quarters will fall to Rs. 36 million from Rs. 60 million.
Businesses will be required to apply for registration within 15 days once the applicable threshold is exceeded.
The Bill also introduces a transitional provision allowing taxpayers who fall within the revised threshold to be treated as compliant with the registration requirement, provided they submit the prescribed application to the Commissioner General of Inland Revenue within 15 days from the date the amendment Act comes into operation.
In addition, the amendments provide for de-registration where a registered entity’s aggregate turnover does not exceed Rs. 36 million over four consecutive quarters, effective from 1 April 2026.
The proposed legislation also introduces changes to the treatment of motor vehicles under the SSCL regime. The exemption currently available on the levy at the point of importing motor vehicles is proposed to be removed from 1 April 2026.
At the same time, the Bill proposes to exempt turnover generated from the wholesale and retail sale of motor vehicles from the levy with effect from the same date.
KPMG noted that although these measures were announced in the 2026 Budget proposals, the Bill does not include transitional provisions addressing situations where motor vehicles imported earlier may remain in inventory as at 31 March 2026.
The amendments form part of the Government’s broader tax policy adjustments introduced through the Budget to refine the SSCL framework and its application across sectors.
