NATIONAL SECURITY LEVY ACT

Arrangement of Sections

1. Short title.

2. Person to whom this Act applies.

3. Imposition of the National Security levy.

4. Payment of the levy.

5. Banks to collect the levy in advance from importers.

6. Deduction from the levy payable by the manufacturer on imports.

7. Levy in default and penalty added thereto.

8. Certain provisions of the Turn Over Tax Act to apply.

9. Sinhala text to prevail in case of inconsistency.

10. Interpretation.

52 of 1991,

36 of 1992,

66 of 1992,

62 of 1993,

25 of 1994,

10 of 1995,

36 of 1995,

11 of 1996,

36 of 1996,

37 of 1997,

17 of 1998,

21 of 1999,

24 of 2000,

4 of 2001,

15 of 2002.

AN ACT to provide for the imposition of a National Security levy for the years commencing respectively, on January 1, 1992, on January 1, 1993, on January 1, 1994, on January 1, 1995 and on January 1, 1996 and for every year commencing on or after January 1, 1997; to provide for the application of the provisions of the Turnover Tax Act, No. 69 of 1981 for the recovery thereof; and to provide for matters connected therewith or incidental thereto.

[Long-title amended by s 2 of Act 66 of 1992; s 2 of Act 62 of 1993; s 2 of Act 25 of 1994; s 2 of Act 36 of 1995; s 2 of Act 36 of 1996; s 2 of Act 37 of 1997.]

[Date of Commencement: 21st December, 1991]

1. Short title.

This Act may be cited as the National Security Levy Act.

[S 1 am by s 3(1)(a) of Act 36 of 1995.]

2. Person to whom this Act applies.

(1) This Act shall apply to every person who—

(a) carries on the business of manufacturer of any article; or

(b) imports any article manufactured outside Sri Lanka; or

(c) carries on the business of insurance or banking or finance; or

[S 2(1)(c) am by s 2(1) of Act 17 of 1998.]

(d) carries on the business of providing telecommunication services; or

[S 2(1)(d) ins by s 2(2) of Act 17 of 1998; am by s 2(1) of Act 24 of 2000.]

(e) carries on the business of providing a service of any description other than a service referred to in paragraph (c) or paragraph (d).

[S 2(1)(e) ins by s 2(2) of Act 24 of 2000.]

(2) Every person referred to in subsection (1) shall, hereafter in this Act be referred to as a "person to whom this Act applies”.

3. Imposition of the National Security levy.

(1) Subject to the succeeding provisions of this Act, there shall be charged from every person to whom this Act applies being a person—

(a) referred to in paragraph (a), (b) or (c) of subsection (1) of section 2, for every quarter or part thereof, of every year commencing on January 1, 1992, on January 1, 1993, on January 1, 1994, on January 1, 1995, on January 1, 1996:and on or after January 1, 1997;

(b) referred to in paragraph (d) of subsection (1) of section 2, for every quarter of part thereof of every year commencing on or after April 1, 1998;

(c) referred to in paragraph (c) of subsection (1) of section 2, for—

(i) the period commencing on February 15, 2000 and ending on March 31, 2000, if the turnover of that person for that period is fifty thousand rupees or over;

(ii) every quarter or part thereof of every year commencing on or alter April 1, 2000, if the turnover of that person for that quarter is one hundred thousand rupees or over,

(hereinafter in this Act referred to as the "relevant quarter”), a National Security levy (hereinafter referred to as "the levy”), calculated on the turnover or part thereof of that person for that quarter or part thereof, at the appropriate rates specified in the Schedule to this Act.

[S 3(1) subs by s 3(1) of Act 24 of 2000 w.e.f. 15 February 2000.]

(2) Notwithstanding the preceding provisions of this section, turnover of a person to whom this Act applies shall, for the purposes of this Act, be deemed not to include—

(a) the proceeds from the export by such person of any article manufactured by him;

(b) the value of any article not being plant, machinery or fixtures imported by such person exclusively for use in, or for, the manufacture by such person, of any article for export;

[S 3(2)(b) subs by s 2(2) of Act 36 of 1992 w.e.f. 1 July 1992; am by s 4(2)(i) of Act 36 of 1995.]

(c) the proceeds from the sale of any article manufactured outside Sri Lanka by the person importing such article;

[S 3(2)(c) subs by s 2(2) of Act 36 of 1992 w.e.f. 1 July 1992; am by s 4(2)(ii) of Act 36 of 1995.]

(cc) the value of any wheat or wheat flour imported by such person;

[S 3(2)(cc) ins by s 2(1) of Act 15 of 2002 w.e.f. 21 February 2002.]

(ccc) proceeds from the sale of any wheat Hour or bread manufactured in Sri Lanka by such person;

[S 3(2)(ccc) ins by s 2(1) of Act 15 of 2002 w.e.f. 21 February 2002.]

(d) the proceeds from the sale of any article to any exporter, if the Commissioner-General is satisfied, on the production of a letter of credit opened in any bank in Sri Lanka in respect of the export of that article or other documentary evidence, that suck article has in fact been exported from Sri Lanka;

[S 3(2)(d) subs by s 3(2) of Act 62 of 1993; am by s 4(2)(iii) of Act 36 of 1995.]

(e) the value of any article which is imported, if proved to the satisfaction of the Commissioner-General of Inland Revenue, that such article is imported to Sri Lanka for—

(i) display at an exhibition;

(ii) the temporary use in Sri Lanka in any project approved by the Minister;

(iii) for the purposes of repairs to that article to be carried out in Sri Lanka; or

(iv) any other similar purpose,

and is to be re-shipped by such person, within a period of one year from the date of importation of such article to Sri Lanka;

[S 3(2)(e) ins by s 4(2)(iv) of Act 36 of 1995.]

(f) the value of any gold imported by such person;

[S 3(2)(f) subs by s 3(2) of Act 37 of 1997 w.e.f. 6 November 1997.]

(ff) the value of any ship or aircraft which is imported into Sri Lanka, if it is proved to the satisfaction of the Commissioner-General of Inland Revenue that such ship or aircraft is being used for international transportation of goods or passengers;

[S 3(2)(ff) subs by s 2(1) of Act 4 of 2001.]

(g) the value of any article imported, if proved to the satisfaction of the Director-General of Customs, that such article was, prior to its importation, taken out of Sri Lanka for repairs;

[S 3(2)(g) ins by s 4(2)(iv) of Act 36 of 1995; am by s 3(2)(b) of Act 36 of 1996; s 2(2)(a) of Act 21 of 1999 w.e.f. 1 April 1999.]

(h) the value of any spare part imported by any airline or shipping company, if proved to the satisfaction of the Commissioner-General, that such spare part is to be used in Sri Lanka for the repair or maintenance of any aircraft or ship, used in international traffic and owned or chartered by such airline or shipping company;

[S 3(2)(h) ins by s 3(2)(c) of Act 36 of 1996; am by s 2(2)(b) of Act 21 of 1999 w.e.f. 1 April 1999; s 3(2)(a) of Act 24 of 2000 w.e.f. 15 February 2000.]

(i) the proceeds from the sale of any article, or any sum received or receivable in respect of the provision of any service to the United Nations Organization or to any specialized agency of such Organization or to the diplomatic mission of any foreign Government or to any member of the diplomatic staff of such mission;

[S 3(2)(i) ins by s 2(2)(c) of Act 21 of 1999 w.e.f. 1 April 1999; am by s 3(2)(b) of Act 24 of 2000 w.e.f. 15 February 2000.]

(j) any sum received or receivable by such person from—

(A) the provision of any one or more of the following services—

(i) supply of electricity;

(ii) medical services;

(iii) supply of water;

(iv) transport of goods or passengers;

(v) leasing of movable property;

(vi) repair services, of any description, if such person is registered under the Goods and Services Tax Act, No. 34 of 1996;

(vii) educational services at an educational institution;

(viii) services of a construction contractor or sub-contractor for the construction of any building, road, bridge, water supply, drainage or sewerage system, harbour, airport or any infrastructure project in telecommunications or electricity, not being—

(a) services for the supply of any material, plant, machinery or equipment; or

(b) professional or consultancy services,

for the purposes of, or in connection with, such construction;

[S 3(2)(j)(A)(viii) subs by s 2(2)(a) of Act 4 of 2001 w.e.f. 1 January 2001.]

(ix) services provided to any exporter of any article, being services directly related to improving the quality and character of such article;

(x) the services of sewing garments provided to any exporter of such garments;

(xi) services of a freight forwarder, shipping agent licensed under the Licensing of Shipping Agents Act, No. 10 of 1972, airline agent licensed under regulations made under the Air Navigation (Special Provisions) Act, No. 55 of 1992 or courier;

[S 3(2)(j)(A)(xi) am by s 2(2)(b) of Act 4 of 2001.]

(xia) services of a port operator or port container terminal operator, provided at any port;

[S 3(2)(j)(A)(xia) ins by s 2(2)(c) of Act 4 of 2001 w.e.f. 15 February 2000.]

(xib) services of a computer software developer in respect of software developed by such person for use wholly outside Sri Lanka and for which payment is received in foreign currency through a bank;

[S 3(2)(j)(A)(xib) ins by s 2(2)(c) of Act 4 of 2001 w.e.f. 8 March 2001.]

(xic) services provided over the internet, using custom built software, by an enterprise set up on or after April 1, 2001, exclusive for the provision of such services being services enabling or facilitating the sale of goods, or for the provision of services, by a person in Sri Lanka to persons outside Sri Lanka, for payment in foreign currency;

[S 3(2)(j)(A)(xic) ins by s 2(2)(c) of Act 4 of 2001.]

(xid) client support services provided over the internet or telephone, by an enterprise set up on or after April 1, 2001, exclusively for the provision of such services, to one or more identified clients outside Sri Lanka, for payment in foreign currency;

[S 3(2)(j)(A)(xid) ins by s 2(2)(c) of Act 4 of 2001.]

(xii) services provided by a public corporation, in so far as such services are in respect of the export of any article from Sri Lanka;

(xiii) operating a hotel, guest house, restaurant or other similar business, if, such hotel, guest house, restaurant or other similar business is registered under the Goods and Services Tax Act. No. 34 of 1996;

(xiv) the services of an auctioneer, broker, Insurance agent or Commission agent of any local produce;

(xv) the services of a travel agent in respect of inbound tours, if such person is registered with the Ceylon Tourist Board.

(B) distribution, or production and supply, of any cinematographic films primarily for exhibition In cinemas;

(C) exhibiting films in a cinema ; and

[S 3(2)(j) ins by s 3(2)(c) of Act 24 of 2000 w.e.f. 15 February 2000.]

(k) .

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