Sri Lanka Postpones Digital Services VAT Implementation to April 2026 Due to Practical Challenges

• Sri Lanka has postponed the implementation of a digital services VAT to April 2026.
• The original date for the VAT was October 01.
• The delay is to address practical challenges.
• The VAT is part of a tax expansion under an IMF program.
• The delay was discussed with the IMF.
• Service providers requested more time for implementation.
• Concerns exist about services like Paypal and Stripe being subject to 18 percent VAT.
• Stripe facilitates fund collection from credit cards and bank accounts.
• Paypal is a payment system linked to credit cards and bank accounts.
• Charging VAT on these services could lead to a 36 percent VAT for Sri Lankan customers.

Source: economynext.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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