CCC President Saranga Wijeyrathne, commenting on the move of the Government to remove WHT on salaries, interest, rent, and dividends, noted it was a progressive step for micro, small and medium sized enterprises (MSMEs) of the country.
Commenting on the subject, Colombo Chamber of Commerce Treasurer Damith Gangodawilage highlighted that the removal of WHT resolved several practical issues faced by citizens and businesses.
WHT on payment made to resident persons for providing employment, investment (renting of properties, interest on deposits, and distribution of Partnership Profits etc.) and for contract and service payments more than Rs. 50,000 per month to a resident individual facilitated to develop the business as the compliance burden has been removed, the statement said.
With the removal of WHT, Inland Revenue has directed banks, financial institution and employers to refund the WHT and PAYE deducted for the month of January 2020. As revised the personal relief (tax free allowance) of individuals up to Rs. 3,000,000 per annum or Rs. 250,000 per month effective from January 2020, every individual who earns income from employment, investment and business above the tax free allowance shall pay the income tax on self-assessment basis on every quarter starting from the first quarter of 2020.
Colombo Chamber of Commerce further stated that the total removal of WHT is not the best practice as it caused the erosion of the tax base of the country.