3 March 2025
The Inland Revenue Department of Sri Lanka will implement VAT on electronic services supplied by non-resident companies to consumers from April 2025.
Currently, foreign businesses providing digital services to consumers in Sri Lanka are not required to charge VAT on their sales. However, to level the playing field between non-resident and resident providers, the Sri Lankan government will expect VAT at a rate of 18% to be charged on these transactions.
Guidance on registration, collection, and payment of VAT will be released in March 2025 and when implemented, this tax will apply to various electronic services, including streaming services, apps, films, e-books, e-journals, and internet services.
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