Finance Act – 2005

Arrangement of Sections

1. Short title.

PART I

Imposition of Social Responsibility Levy

2. Imposition of Social Responsibility Levy.

3. Social Responsibility Levy to be collected by relevant authorities.

4. Maintenance of records.

5. Action in cases of failure to pay levy.

6. Date of operation of this Part and indemnity.

6A. Interpretation for this Part.

PART II

Imposition of Share Transaction Levy

7. Imposition of Share Transaction Levy.

8. Share Transaction Levy to be collected by relevant stockbroker.

9. Returns to be furnished of collections.

10. Action in case of failure to pay levy.

11. Interpretation for Part II.

12. Date of operation of this Part and indemnity.

PART III

Construction Industry Guarantee Fund Levy

13. Imposition of Construction Industry Guarantee Fund Levy.

13A. Any person or partnership to deduct construction Industry Guarantee Fund Levy.

14. Mode of collection of Construction Industry Guarantee Fund Levy.

15. The Commissioner-General of Inland Revenue to collect the Construction Industry Guarantee Fund Levy on behalf of the Government.

16. Secretary to the Treasury to issue guidelines.

17. Statements to be furnished of collection.

18. Maintenance of records.

19. Action in cases of failure to pay levy.

20. Interpretation for Part III.

21. Operation of the provisions of this Part.

22. Indemnity.

PART IV

Amendment of Finance Act, No. 11 of 2002

23. Amendment of section 2 of Part I of the Finance Act, No. 11 of 2002.

24. Indemnity.

PART V

General

25. Regulations.

26. Sinhala text to prevail in case of inconsistency.

SCHEDULES

5 of 2005,

11 of 2006,

13 of 2007,

45 of 2007,

8 of 2008,

18 of 2009,

15 of 2011.

AN ACT to make provision for the imposition of certain levies consequential to the 2005 budget proposals; and to make provision for matters connected therewith or incidental thereto.

[Date of Commencement: 30th March, 2005]

1. Short title.

This Act may be cited as the Finance Act.

PART I

Imposition of Social Responsibility Levy

2. Imposition of Social Responsibility Levy.

A levy to be called the Social Responsibility Levy shall, subject to the provisions of this Act, be imposed—

(a) for the period commencing on January 1, 2005 and ending on December 31, 2005, at the rate of 0.25 per centum;

[S 2(a) ins by s 10(1) of Act 11 of 2006.]

(b) for the period commencing on January 1, 2006 and ending on December 31, 2007 at the rate of 1 per centum; and

[S 2(b) ins by s 10(1) of Act 11 of 2006; subs by s 2(1) of Act 8 of 2008.]

(c) the rate of 1.5 per centum, for the period commencing on January 1, 2008 and ending on—

(i) November 22, 2010 in respect of the Social Responsibility Levy chargeable under the Excise Ordinance, the Customs Ordinance and the Excise (Special Provisions) Act, No. 13 of 1989; and

(ii) March 31, 2011 in respect of the Social Responsibility Levy chargeable under the provisions of the Inland Revenue Act, No. 10 of 2006:

[S 2(c) ins by s 2(1) of Act 8 of 2008; subs by s 3(1) of
Act 15 of 2011.]

on all taxes and levies chargeable in terms of the provisions of the enactments specified in the First Schedule to this Act. The funds so collected by way of the Social Responsibility Levy shall be disbursed for meeting any expenditure incurred for the implementation of activities connected with the National Action Plan for Children, approved by the Government:

Provided that the imposition of the Social Responsibility Levy in terms of the provisions of this Part of this Act, on income tax chargeable under the provisions of the Inland Revenue Act, No. 38 of 2000, shall be effective from
April 1, 2005.

[S 2 am by s 10(1) of Act 11 of 2006.]

Provided further that the Social Responsibility Levy chargeable—

(a) under the provisions of the Inland Revenue Act, No. 38 of 2000, in terms of the provisions of this Part of this Act on income tax, shall, in respect of the period commencing on January 1, 2006 and ending on March 31, 2006 be calculated at the rate of 0.25 per centum; and

(b) under the provisions of the Inland Revenue Act, No. 10 of 2006 in terms of the provisions of this Part of this Act on income tax shall—

(i) in respect of the period commencing on April 1, 2006 and ending on March 31, 2008 be calculated at the rate of 1.0 per centum;

(ii) in respect of the period commencing on April 1, 2008, but prior to April 1, 2011, be calculated at the rate of 1.5% per centum.

[S 2 second proviso subs by s 2(2) of Act 8 of 2008;
(b)(ii) subs by s 3(2) of Act 15 of 2011.]

3. Social Responsibility Levy to be collected by relevant authorities.

The Social Responsibility Levy collectable in terms of section 2 shall be collected at the time of payment of such taxes or levies, by the relevant authorities administering such enactments as are specified in the First Schedule to this Act and shall be credited to a special account operated for such purpose. The money so collected shall be remitted to the Consolidated Fund within fifteen days from the date of the collection of such money by the relevant authorities.

4. Maintenance of records.

Every relevant authority administering the enactments specified in the First Schedule shall maintain records of all amounts collected by such authorities in relation to the Social Responsibility Levy chargeable by such authorities in terms of the provisions of the respective enactments specified in the Schedule to this Act.

5. Action in cases of failure to pay levy.

(1) Any person to whom the provisions of this Part of this Act applies, who fails to pay the total amount of the Social Responsibility Levy in terms of section 2, shall be deemed to be a defaulter and where such defaulter is a body corporate, the Chairman of the Board of Directors, any Director or principal officer of such body corporate shall be deemed to be a defaulter for the purposes of this Part of this Act, and such Levy as is not paid on or before the due date shall be deemed to be a Levy in default.

(2) The defaulter shall be liable to pay a surcharge in addition to the Social Responsibility Levy in default, calculated—

(a) at the rate of ten per centum of the amount of such levy as is in default for the subsequent period of one month or part thereof, from the due date for the payment of the Levy under section 2; and

(b) at the rate two per centum of the amount of such Levy as is in default for each subsequent period of one month or part thereof, from the due date for the payment specified in paragraph (a),

which surcharge shall be collected by the relevant authorities administering the enactments specified in the First Schedule to this Act.

(3) The relevant authorities administering the enactments specified in the First Schedule shall take action to recover the Social Responsibility Levy or such part of the Levy which is in default for a period of more than three months, and the amount of the surcharge accrued thereon, in the manner as is specified hereafter.

(4) The relevant authorities administering the enactments specified in the First Schedule shall cause to be issued on the defaulter, three weeks prior to the taking of any steps for the recovery of the Social Responsibility Levy in default along with the amount of the surcharge accrued thereon, a Notice, informing the defaulter of the intention of the relevant authorities administering the enactments specified in the First Schedule to institute proceedings for the recovery of the amount of the Social Responsibility Levy in default and the amount of the surcharge accrued thereon, in terms of the provisions of this section.

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