Cabinet approval has been granted for the removal of the Simplified Value- Added Tax (SVAT) scheme effective from April 01, 2025.
According to the Government, the Cabinet had initially given approval to submit to the Parliament the draft bill prepared by the Legal Draftsman in order to revise the Value – Added Tax Act No. 14 of 2002 including the repeal of the SVAT scheme with effect from January 01, 2024.
However, representations made by the relevant parties pointed out that drastic issues may erupt in finance flow in relation to individuals, especially exporters, who have been registered under the system at present if the SVAT scheme is repealed without a strong Value – Added Tax repayment system.
It was pointed out that it is appropriate to repeal the SVAT system step by step until a strong tax repaying mechanism is established.
Accordingly, the Cabinet approved the proposal presented by the President in his capacity as the Minister of Finance, to submit a proposal for revision of the date of implementation of the relevant provisions to repeal the SVAT scheme from January 2025.
Amendments were made to the proposal when it was taken up for discussion at the Parliament committee stage discussion on the Value – Added Tax (Amended) Bill. (NewsWire)