Sri Lanka has enacted the Inland Revenue (Amendment) Act No. 11 of 2026, introducing higher capital gains tax rates, expanded taxpayer identification number (TIN) requirements and tougher compliance measures, according to a KPMG Sri Lanka analysis.
Under the amendments, the capital gains tax rate for individuals and partnerships rises from 10% to 15%, while the rate for trusts, unit trusts, mutual funds and NGOs increases to 30%. The law also makes TIN verification mandatory for activities including opening bank accounts, registering vehicles and obtaining credit cards.
The legislation further expands withholding tax requirements, introduces new enforcement powers for tax authorities and provides enhanced capital allowances for qualifying investments. The Act was certified by the Speaker on June 3 and published in the Gazette on June 5. (Newswire)
