- SVAT system was introduced in 2011 to simplify VAT process and benefit exporters.
- SVAT was designed to reduce corruption, administrative burden, and cash flow problems for exporters.
- The IMF recommends replacing SVAT with a robust VAT refund system.
- Abolishing SVAT could negatively impact businesses, especially SMEs, by increasing costs and administrative burden.
- Author recommends improving the current SVAT system instead of abolishing it.
- The 2025 Budget speech announced a transition from SVAT to a risk-based refund system.
- A pilot project will be implemented to issue refunds through RAMIS.
- The VAT Amending Bill will abolish SVAT from 1 October 2025.
- Excess VAT will be refunded within 45 days for taxable periods starting on or after 1 October 2025.
Source: ft.lk
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.
