Performance Report 2007 - Department of Inland Revenue

Performance Report 

2007 

DEPARTMENT OF INLAND REVENUE 

SRI LANKA


Performance Report 

DEPARTMENT OF INLAND REVENUE 

i

Department’s Mission 

• To collect taxes in-terms of relevant tax and other 

related laws, by encouraging voluntary compliance 

while deterring tax evasion and tax avoidance, 

and 

• To enhance public confidence in the tax system 

administered by the Department of Inland Revenue 

by administering relevant tax and other related laws 

in a fair, friendly and expeditious manner and 

thereby facilitate a beneficial tax culture. 

-- Code of Ethics and Conduct-- 

Strategic Goals 

• To improve voluntary compliance by taxpayers with 

the tax laws through programmes which encourage 

and assist that and detect those who do not comply 

and, where necessary, take appropriate corrective 

action. 

• To improve the effectiveness of the Department by 

the application of efficient work methods, technology 

and better utilization of available resources. 

• To enhance the productivity and professionalism of 

the staff through management and technical 

training, work experience, and thereby to enable 

them to contribute more effectively towards the 

fulfillment, by the Department, of its mission. 

ii

PRINCIPAL OFFICIALS 

Mr. A.A. Wijepala 

Commissioner General of Inland Revenue 

Mr. S. Angammana 

Deputy Commissioner General 

Tax Surveillance, Risk Management and International Affairs 

Mr. E.A.S. Edirisinghe 


Tax Policy Planning & Development, Legislation, Rulings & BOI Enterprises 

Mr. R.K.H. Kaluarachchi 


Indirect Taxes & Communication Technology 

Mr. E.M.M. Medagoda 


Tax Administration 

Mr. H.M. Herath 


Human Resources 

iii

Mr. V.D.G.P. Ubesiri 

Senior Commissioner - Large Taxpayer Unit 

Mr. P. Wickramasena 

Senior Commissioner - Internal Audit 

Mr. K.M.S. Kandegedara 

Senior Commissioner- Zone 1 

Mrs. M. Samarasekera 

Commissioner-Value Added Tax 

Mr. K.L.S. Silva 

Commissioner-Assessment Control, Internal Audit/ Systems and Finance Audit 

Mr. H.B.A. Seneviratne 

Commissioner - Strategic & Operational Planning, Tax Policy & Rulings 

Mrs. D.M. Nandawathie 

Commissioner-Information and Non Filers & Stop Filers 

Mr. A.A. Amararatne 

Commissioner-Corporate Tax and Appeals 

Mr. R.K. Premadasa 

Commissioner-Tax Payer Services and Withholding Tax 

Mr. H.M. Abesinghe 

Commissioner-Human Resource Management 

Mr. P.D. Premaratne 

Commissioner-Investigation and Legal & Collection Clearance 

Mr. H.M. Premaratna Banda 

Commissioner-Large Tax Payers Unit 

Mr. S.T.Gobalasingham 

Commissioner-Zone III and ESC 

Mr. K.A.P. Kaluarachchi 

Commissioner- PAYE 

Mrs. W.B.S. Shanthikumar 

Commissioner-Employee Services 

Mrs. L. Ramanayake 

Commissioner-Human Resource Development 

Mr. W.M.W. Kumarasiri 

Commissioner-BOI & Investment Promotion and Stamp Duty 

Mr. W.M. Mendis 

Commissioner-Zone I 

Mr. A.L.A. Sirisena 

Commissioner-Metropolitan Branches 

Mrs. H.M.C.I. Gunasekera 

Commissioner-Collection 

Mr. W.V.P. Karunaratne 

Commissioner-Assessment Control “B” 

iv

Content 

YEAR 2007–Noteworthy Achievements and Events in Brief….....................................................vi 

Organisation Chart...........................................................................................................................ix 

CHAPTOR 01- HUMAN RESOURCES ...................................................................................... 1 

1.1 Approved Cadre, the number in post and vacancies................................................................1 

1.2 Training........................................................................................................................................2 

1.2.1 Overseas Training ..................................................................................................................................2 

1.2.2 Overseas Training provided through the Fiscal Management Reform Programme. (FMRP).............3 

1.2.3 In-house Training...................................................................................................................................3 

1.3 Promotions ...................................................................................................................................5 

1.4 Recruitments ................................................................................................................................5 

1.5 Retirements ..................................................................................................................................5 

1.6 Disciplinary action.......................................................................................................................6 

CHAPTOR 02-REVENUE COLLECTION ................................................................................ 7 

2.1 Number of Taxpayers..................................................................................................................7 

2.2 Total Revenue ..............................................................................................................................8 

2.3. Income Tax Collection...............................................................................................................11 

2.3.1 Corporate and Non-corporate Income Tax..........................................................................................11 

2.3.2 Source wise Analysis of Income Tax Collection ................................................................................12 

2.3.3 Income Tax Return Filing Compliance 2002/2003 to 2006/2007 ......................................................12 

2.3.4 PAYE Returns Filing Compliance-2006/2007....................................................................................13 

2.4 Economic Service Charge .........................................................................................................13 

2.5 Value Added Tax Collection.....................................................................................................14 

2.6 Stamp Duty Collection ..............................................................................................................16 

2.7 Betting & Gaming Levy Collection..........................................................................................17 

2.8 Debits Tax Collection ................................................................................................................17 

2.9 Share Transaction Levy ............................................................................................................18 

2.10 Construction Industry Fund Levy ...........................................................................................18 

2.11 Inland Revenue Collection 2003 to 2007..................................................................................18 

2.12 Inland Revenue Contribution to the Government Revenue and GDP .................................19 

CHAPTOR 03-EXPENDITURE AND PRODUCTIVITY RATIO......................................... 21 

3.1 Comparison of the total expenditure incurred during the year with 2005 and 2006. .........22 

3.2 Analysis of the Recurrent Expenditure in 2007......................................................................23 

3.3 Productivity Ratio .....................................................................................................................23 

CHAPTOR 04-TAXES IN DEFAULT ....................................................................................... 25 

CHAPTOR 05-INTERNATIONAL RELATIONS ................................................................... 27 

5.1 Double Tax Treaties ..................................................................................................................27 

5.2 Participations at International Taxation Matters Abroad ....................................................28 

CHAPTOR 06-LEGISLATION .................................................................................................. 29 

6.1 Legislation made during the year.............................................................................................29 

6.2 Rulings Given During The Year...............................................................................................29 

6.3 Approved Charities ...................................................................................................................30 

CHAPTOR 07-AUDITS, ADDITIONAL TAX COLLECTIONS, RECOVERY ACTIONS 

AND APPEALS.................................................................................................. 31 

7.1 Particulars of Audits and Additional Tax Collection during the year. (Rs: Mn) ................31 

7.2 Additional information on Additional Taxes ..........................................................................31 

7.3 Appeals .......................................................................................................................................32 

7.4 Board of Review.........................................................................................................................32 

CHAPTOR 08-TAX PAYER SERVICES.................................................................................. 33 

Annexure I…………………………...………………………………………………………… 35 

Annexure II……………………………..………………………………………………………..37 

v

YEAR 2007–Noteworthy Achievements and Events in Brief… 

The year 2007 was a jubilant year for the Department of Inland Revenue which was established in 

1932, as it celebrated the 75 th anniversary during the year. Many special activities were organized 

in parallel to the commemoration of this Platinum jubilee event. The Department administered 9 

types of taxes viz: Value Added Tax , Income Tax, Economic Service Charge, Debits tax, Stamp 

Duty, Share Transaction Levy, Social Responsibility Levy and Betting & Gaming Levy, 

Construction Industry Guarantee Fund Levy, during this year. 

o Commemoration of 75 th Anniversary: Campaigns were arranged with a view to make the 

public aware of the mission of the Department; encourage the taxpayers for improved tax 

payments; and to emphasize the importance of paying tax. These campaigns were carried out 

mainly through the print media, electronic media, posters, brochures etc. and by the “Inland 

Revenue Walk”. 

The campaign titled “Payment of Tax is Your Responsibility” was launched with the theme 

that the payment of taxes is the responsibility of a good citizen who in turn deserves the 

recognition and respect therefor. The objectives of this campaign were to create a positive 

perception among the public towards the voluntary payment of taxes to the State for the use in 

development activities, and to communicate that the payment of tax is a responsibility of 

citizens rather than an obligation. 

“Rata Venuven Api” campaign was another, to emotionally motivate voluntary payment of 

taxes and to communicate how the people voluntarily paying their taxes become stakeholders 

in the nation building process. 

o Revenue: the Department achieved a total collection of Rs. 308.2 Billion revenue during the 

year in keeping with the continued increasing trends in the revenue collection. This year the 

total collection of the Department constituted 54.54% of the Government revenue 1 , which is 

a contribution of 8.1% to the GDP at current market prices. Though this collection was 

marginally lower than the expected revenue (revised estimate of revenue), it is significantly 

higher than the previous year’s collection. This was achieved despite the fact that the 

Department had to train almost 55% of the staff newly recruited during the year. 

o Recruitments: 267 new Assessors, and 527 new Tax Officers, were recruited to the 

Department during the year, resolving a major part of the staff shortage problem, which had 

considerably affected the performance of the Department. 

1 Govt. revenue as reflected in the year 2007 Annual Report of Ministry of Finance 

vi

o New Regional Offices and branches: A new Regional Office was opened as scheduled in 

January at Yakkala to facilitate and deal with taxpayers in the Gampaha Region, and a Special 

VAT Audit Branch was established to expedite the post audit process of VAT refund cases. 

Another branch (Advance VAT) was opened at the Head Office to implement the Withholding 

Tax System introduced to VAT. 

o Tax payer Services: Services provided at the Taxpayer Service Unit housed in the ground 

floor of the Inland Revenue Building were streamlined for the taxpayers and the public to 

improved access for information and get the services conveniently. The Unit has been 

provided with Officers to assist every person seeking help and information. Relevant 

enactments, departmental publications, paying-in-slips, forms etc. are made available in this 

Unit. Taxpayer Identification Numbers (TINs) and temporary VAT Numbers are issued at this 

Unit. During the year, 10,458 Tax Payers Identification certificates and 14,249 temporary 

VAT registration certificates were issued. On an average the services were obtained by 

approximately 250 persons a day during this year. 

o Tax Payer Education: Seminars and lectures on tax related matters and procedures were 

organized to educate taxpayers and upgrade the skills of the staff of the Department. 

Several seminars were held in Colombo and other provissional cities. 14 seminars were held 

within Colombo District and 6 seminars were held respectively at Bandarawela, Kurunegala, 

Ratnapura, Polgahwela, NuwaraEliya, and Badulla. 

o Issuing privilege Cards and Car permits to good Taxpayers: The process of issuing 

privilege cards to individual taxpayers to recognize their contribution to the Government 

Revenue and to make them entitled to certain benefits such as preferential treatments at 

Government Agencies, continued with added modes. During the year, 152 individual 

taxpayers were awarded with Gold Cards and 252 individual with Silver Cards. Further, 202 

certificates were issued, on request, to individual taxpayers who had paid income tax for the 

last 5 consecutive years in excess of Rs 250,000/- per year, in support and confirming their 

entitlement to tax and duty rebate on the importation of a motor vehicle. 

o Computer Training Center: the “Computer Training Center” set up in 2006 continued 

providing training and during the year 557 Officers were trained. 

o Provision of Overseas & local Training: The Overseas training program were carried out 

continuously, particularly, to provide the Officers an exposure on tax policies in other 

countries and to upgrade their skills and knowledge. A Special program of training organized 

with the assistance of FMRP enabled altogether 514 officers of all ranks from Commissioner 

vii

downwards to be trained in India, during this year. Further, 33 Officers selected under normal 

selection program participated in training programs conducted in other countries. In addition 

all the Commissioners and Deputy Commissioners participated in a special overseas training 

program on “Investigation and Management Course conducted at National Tax Academy of 

Direct Taxes, India. 

o VAT Refunds: To streamline and to expedite VAT refund without delays a system of 

releasing refunds on Bank guarantees submitted by registered exporters were introduced 

during the year. This refund process was further facilitated through opening of a special 

account at the Central Bank to cater to such refunds. Accordingly, 7150 refunds have been 

issued during the year. 

viii

Organisation Chart 

(As at 31-12-2007) 

Board of Review 

Ombudsman 

Commissioner General / 

Chairman - Revenue Board 

Secretary to the Revenue Board 

Senior Commissioner: Internal Audit 

Commissioner: System & Finance Audit 

Deputy Commissioner 

Chief Accountant 

Senior Deputy Commissioner 

General 

Building Engineer 

Commissioner: 

Procurement & 

Supplies 

Commissioner: 

Appeals 

Deputy 

Commissioner 

DCG: 

Tax Administration 

• Commissioner: 

Taxpayer Services 

[TS] 

• Commissioner: Audit 

[Aud] 


Collection & 

Enforcement [C&E] 


Returns & Payment 

Processing [R&PP] 

DCG: ICT 

[Chief Information Officer] 

• Commissioner: ICT I 

[ICT Manager, 

Developments & Reforms] 

• Commissioner: ICT II 

ICT Manager, Projects & 

Engineering] 

• DC: Application & 

Database Development 

Unit [Team Leader] 

• DC: Network Operations 

Centre [Team Leader] 

• DC: ICT Reforms 

• DC: Special Projects 

DCG: HRM 


Human 

Resources 


Human 

Resource 

Development 


Employee 

Services 

• HR Specialist I ** 

• HR Specialist II 

DCG: Tax 

Surveillance & Risk 

Management and 

International Affairs 


Investigation 


International 

Affairs 


Information & 

Non Filers & Stop 

Filers 

Deputy 

Commissioner 

DCG: Tax Policy 

Planning & 

Development, 

Legislation, Rulings 

& BOI Enterprises 


Strategic and 

Operational 

Planning, Tax 

Policy Planning, 

Legislation , and 

Rulings 


BOI & Investment 

Promotion 


Research & Policy 

• Policy, Planning & Standards Guidance ** 

• Database Administrator 

• Application Developer 

• Hardware, Network & System Administrator 

• Cyber Security & Risk Administrator 

• Data Centre Administrator 

• e-Government 

• Emerging Technology 

• Intranet/Web Developer 

• Software Engineering & QA 

• IT Helpdesk 

• ICT Competitive Outsourcing 

Training Centre 

Deputy 

Commissioner 

• Tax Policy Analyst ** 

• Fiscal Policy Expert 

• Economist 

• Financial Analyst 

• Legal Officer 

• Research Assistant 

• Statistician 

Senior Commissioner: Tax 

Administration - Zone 1 

Senior Commissioner: 

Tax Administration - LTU 


Tax Administration - 

Zone 2 


Tax Administration - 

Zone 3 

• Commissioner: Colombo 

Regional Offices, VAT, 

Stamp Duty, Unit 3 and ESC 

• Commissioner: LTU, 

Corporate Tax & Debits 

Tax 

• Commissioner: South 

Region 

• Commissioner: North 

Region 

Deputy Commissioners 




GIR 

ix

CHAPTER 1 

HUMAN RESOURCES 

1.1 Approved Cadre, the number in post and vacancies. 

The following Table shows the approved Cadre of the Department, the actual number in post and 

the vacancies, as at December 31, 2007. 

Cadre of the Department as at 31.12.2007 

Grade 

Approved 

Cadre 

Number in 

post Vacancies 

Commissioner General 1 1 - 

Senior Deputy Commissioner General 1 - 1* 

Deputy Commissioner General 6 5 1 

Senior Commissioner 5 3 2 

Commissioner 22 21** 1 

Deputy Commissioner 90 82 8 

Senior Assessor 57 

Assessor 750 

627 66 

Assessor (Supernumerary) 

47 - 

Senior Tax Officer 158 

Tax Officer 1000 

544 298 

Other 

- Director (Administration) 1 1 - 

-Engineer 1 1 - 

-System Analyst 6 1 5 

-Librarian 1 1 - 

- Accountant 7 7 - 

-Stamp Clerk 1 1 - 

-System Controller 3 3 - 

-Computer Operator 11 4 7 

-Data Entry Operator 18 8 10 

-System Manager 2 2 - 

-Budget Assistant 2 2 - 

-Receptionist 4 4 - 

-Store-man 3 2 1 

-Carpenter 1 1 - 

-Building Supervisor 1 - 1 

-Supply Assistant 1 - 1 

Combined Services 

- Public Management Assistant 311 237 74 

-Translator 9 9 - 

-Driver 74 70 4 

- K K S 319 313 6 

Total 2651 2212 486 

* This post was not filled, as the recruitment procedure had not been finalized. 

** 3 posts were filled in 2008, with effect from respective dates in the year 2007. 

1

1.2 Training 

1.2.1 Overseas Training 

Exposure of officers of the Department to the advances made in the administration of taxes and 

best practices of other Countries has been recognized by the Department as a necessity to 

maintain a level of professionalism of officers as tax administrators. Accordingly, arrangements 

were made for several officials to participate in training programmes, seminars or workshops held 

abroad. 

Details of such officials who have been sent and the training programs they participated are as 

follows: 

Name & Designation 

of the Officer 

Name of the Programme Country of Duration 

Training 

1 Mr. A A Wijepala - CGIR The valediction function of Investigation & India 15-16 Dec. 2007 

Management Training Course 

2 Mr. E M M Medagoda - DCGIR i.) 12th Annual International Taxation Meeting France 19-21 Sep. 2007 

on Tax Treaties 

ii.) Study Tour (under FMRP Project) 

Hong Kong & 

Phillippines 

26-29 Nov. 2007 

3 Mr. H M Herath - DCGIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. 2007 

4 Mrs. Anula Senevirathna SCIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. 2007 

5 Mrs M Samarasekara - CIR 2nd Country Study Visit of MPM Programme Thailand 01-15 Sep. 2007 

6 Mr. A A Amararathna - CIR 12th Annual International Taxation Meeting France 19-21 Sep. 2007 


7 Mr. R K Premadasa - CIR 28th CATA Annual Technical Conference Kenya 06-10 Aug. 2007 

8 Mrs. L. Ramanayake - CIR 2nd Country Study Visit of MPM Programme Thailand 01-15 Sep. 2007 

9 Mr. A L A Sirisena - CIR 12th Annual International Taxation Meeting France 19-21 Sep. 2007 


10 Mrs. K Dahanayake - CIR 2nd Country Study Visit of MPM Programme Thailand 01-15 Sep. 2007 

11 Mr. H N S Siriwardana - DC Workshop on "Taxation of International 

Malaysia 06-24 Aug. 2007 

Transactions" 

12 Mrs. R Wijesinghe - DC Principles of International Taxation Netherlands 

29 Jan-02 Feb. 


13 Mr.K H N C Perera - DC Principles of International Taxation Netherlands 

29 Jan.-02Feb. 


14 Mrs. S N P Abrew - DC Principles of International Taxation Netherlands 



15 Mr. P L A Liyanage - DC Principles of International Taxation Netherlands 



16 Mr. A A Dayarathne - DC Macro Economic Management and Fiscal Singapore 

29Oct.-09 Nov. 


Policy Programme 

17 Mr. B G Piyadasa - DC Principles of International Taxation Netherlands 



18 Mrs. Vijitha Paranamana - DC Interpretation & Application of the Tax Treaties Netherlands 05 -07 Mar. 2007 

19 Mr. E Shelton Soysa - DC Introduction to European Value Added Tax Netherlands 12-15 Mar 2007 

20 Mr. U P S A Jayalath - DC Study Tour (under FMRP Project) Hong Kong & 

Phillippines 

21 Mrs. N K A I K Gunarathna Tax Analysis and Revenue Forecasting U.S.A 

- SA Programme 

22 Mr. O W N Gunasekara Tax Analysis and Revenue Forecasting U.S.A 

2 


15 Jul. - 10 Aug. 


15 Jul. - 10 Aug. 

2007


23 Mr. R M D Banda Principles of International & Comparative Taxation Netherlands 

20 Aug.-01 Sep. 


- SA 

24 Mr. G D S Jayarathna 2nd Country Study Visit of MPM Programme Thailand 01-15 Sep. 2007 

- SA 

25 Mr. S M A Bandara Tax Analysis and Revenue Forecasting U.S.A 

15 Jul. - 10 Aug. 



26 Mrs. D W N Wijekoon Tax Analysis and Revenue Forecasting U.S.A 

15 Jul. - 10 Aug. 



27 Mrs. K G C Priyadarshani Advanced Management Potential (AMP) U.K 

30 Jul.-14 Sep. 


- SA 

28 Mrs. R P H Fernando Fiscal Planning, Management & Reforms India 17-28 Dec. 2007 

- Assessor Programme (under FMRP Project) 

29 Mr. B K Saman Santha Commonwealth Tax Inspectors Course (CTIC) U.K 

30 Jul.-14 Sep. 


- Assessor 

30 Mr. Avantha Walimini Master's Degree Programme on Korean Economy Korea 27.12.2007 

- Assessor & Business (to 18.02.2009) 

31 Mr. N Ariyathilaka Study Tour (under FMRP Project) 

Hong Kong & 

Phillippines 


System Administrator 

32 Mr. P G Siridasa Training Programme at INGAF India 

26 Feb.-13 Mar. 


- Chief Accountant 

1.2.2 Overseas Training provided through the Fiscal Management Reform Programme. 

(FMRP) 

Under the auspices of FMRP, the training programme on “Practical Issues of Tax Policy & Tax 

Administration in Developing Countries” conducted in India was continued during this year as well. 

Each batch of officers who participated in that programme included a Commissioner and officers 

selected from all other grades below the grade of Commissioner. In addition, 88 officers 

participated in the specialized training programme on Audit and Investigation, International 

Taxation and management organized by the National Academy of Direct Taxes of India. The 

details of the officers who participated in this training programme are given in the Annexure I. 

1.2.3 In-house Training 

Training Branch of the Department conducts training courses and examinations for Assessors and 

Tax officers, regularly. This is aimed at enhancing the knowledge and improving analytical skills, 

particularly in taxation and accountancy. Emphasis is given in providing the training on subjects 

that is required to fulfill various service requirements of officers in official activities, in addition 

to achieve a sufficient level of competency for their confirmation in the respective grades. Details 

of personnel trained and the examinations conducted during the year are as follows: 

3

1) Training for Assessors – 

I. 106 Assessors in the Class 2, Grade II (promoted on 03.08.2005), were 

trained for the Preliminary Departmental Examination 

II. 

68 Assessors in Class 2 Grade II were trained for the Final Departmental 

Examination. 

III. Training classes were conducted for 17 Assessors (promoted on 20.06.2003) 

for their final Departmental examination to be held in 2009. 

IV. 

Training Classes were conducted for Assessors who were recruited on 

02.10.2006 and 01.01.2007 (a total of 479 in number) for the Preliminary 

Departmental Examination to be held in 2008. 

V. 18 Assessors in Class 2 Grade II (recruited on 03.05.2007) were trained for 

the Preliminary Departmental Examination to be held in 2009. 

2) Training for Tax Officers 

• 36 Tax Officers in Class 3 Grade I were trained to enabled them to get the 

eligibility to the promotion to Class 2 Grade II. 

• 506 Tax Officers in Class 3 Grade II were trained for the examinations to be 

held in 2008 for confirmation in Class 3 Grade II 

3) Examinations for Assessors: 

Examination Held in Number 

Sat 

01 Preliminary Examination for Assessors 

in Class 2 Grade II (Repeat- 3 rd attempt) 

02 Final Departmental Examination for 

Assessors in Class 2 Grade II 


Assessors in Class 2 Grade II (Repeat – 

2 nd attempt) 


Assessors in Class 2 Grade II (Repeat- 

3 rd attempt) 

10.05.2007 to 

16.05.2007 







01 01 

57 32 

25 22 

3 3 

Number 

Successful 

4) Examinations for Tax officers: 

Examination Held in Number 

Sat 

Number 

Successful 

01 Examination for 3-II Tax Officers for 

confirmation in 3 –I and eligibility for 

promotion to 2-II 

07.11.2007 36 32 

4

5) Seminars conducted: 

Date 

Subject 

21.02.2007 Conducting a Rapid Audit (1) 


21.03.2007 Practical Approach to VAT I 


27.04.2007 Practical Approach to VAT II 

04.07.2007 Problematic Areas of VAT 

18.07.2007 Examinations of Forged Documents 

08.08.2007 Recent Amendments to Income Tax & Value Added Tax 

6) Business Communication Program: 

Training classes were organized for Business Communication, through the British Council 

for Deputy Commissioners, Assessors and Tax Officers, under the auspicious of FRM 

Project. 

7) Other 

Four Orientation Programmes for Assessors and Tax Officers recruited in 2007 were 

conducted during the year. 

1.3 Promotions 

The following Deputy Commissioners were promoted to the rank of Commissioner: 

Name 

Date of Promotion 

Mr. S Rajapakse 08.03.2007 

Mr. P A V Premaratne 08.06.2007 

Mrs. K Dahanayake 14.06.2007 

19 Assessors were promoted to the grade of Senior Assessor with effect from 10.09.2007. 

36 Tax Officers were also promoted to the grade of Senior Tax Officer effective from 01.07.2007 

1.4 Recruitments 

Human Resources Department concentrated its resources to complete the recruitment process 

during the year. Accordingly, 267 Assessors and 527 Tax Officers were recruited on the basis of 

the results of Open Competitive Examination held in mid 2006. 

1.5 Retirements 

The following Officers retired during the Year. 

Senior Commissioners 

o Mrs. Anula Senevirathne 

o Mr. H A Somapala 

5

Commissioners 

o Mr. W. Auther Fernando 

o Mr. W. Thilakaratne 

o Mrs. R.A.M.A. Herath 


o Mrs. K.P.M.Gunatilake 

o Mr. H.H.R.Somasiri 

o Mr. B.M.Ariyadasa 

o Mr. U.B.Keerthisinghe 

Other 

Mr. H.A. Somapala 

Senior Assessor 1 

Assessors 34 

Senior Tax Officer 1 

Public Management Assistants 4 

K K S 5 

Building Supervisor 1 

Mr. Somapala retired from the Inland Revenue Service on October 3, 2008. At the time of his 

retirement he held the post of Senior Commissioner in charge of the Zone III Region of the 

Department. Having begun the career in the Department on 1 st March 1966 as a young member 

of the General Clerical Service, he served with dedication for a period as long as 41 years in 

the respective capacities up to the rank of Senior Commissioner. 

Mr. Somapala, during the tenure of his office, participated at the CATA Regional Training 

Programme held in Ghana in 1995 and followed a programme on application of tax treaties in 

Korea in 2001. 

Mrs. A. Seneviratne 

Mrs. Seneviratne joined the Department on December 1, 1968 as a member of general clerical 

service. At the time of her retirement from service on September 14, 2007, she had been 

functioning as the Senior Commissioner in charge of Zone II Region. Mrs. Seneviratne counted 

39 years in the Department, extending a devoted service in every assigned area. During her tenure 

of office, she followed a Policy Workshop on Bench Marking & ISO 9000 in Malaysia in 2001 

and participated at the 28th CATA Annual Technical Conference held in Kenya in 2007. 

1.6 Disciplinary action 

Category Balance O/S on 

01. 01. 2007 

Concluded during 

the year 

Balance O/S on 31. 

12.2007 

Tax Officer 3 1 2 

Assessor 2 1 1 

Deputy Commissioner 1 1 

6

CHAPTER 2 

REVENUE COLLECTION 

The Department of Inland Revenue being the main contributor to the Government’s revenue is 

entrusted with an immense responsibility of collecting revenue to the Government. Hence, a 

concerted effort was made to fulfill the revenue requirements of the Government to keep ahead in 

line with the mission of the Department. The Department collected a net revenue of Rs. 

308,205,526,964/- (including Social Responsibility levy) during the year. This sum reflects an 

increase of Rs. 54.9 Billion (21.67%) over that of the year 2006. This Revenue was built up by 

attending 583,365 tax payers during the year. Out of which, 324,268 employees were paying 

income tax under PAYE scheme for which separate tax files were not maintained by the 

Department. 

2.1 Number of Taxpayers 

The number of persons registered with the Department for the payment of tax, as at the end of the 

year, is given in Table 01. 

Table 01 

Income Tax. 

Corporate 

Number of Taxpayers as at 31-12-2007 

• Resident Companies 24,132 

• Non-Resident Companies 523 

• State Corporations, Statutory Boards and State owned institutions 

195 

Non Corporate 

• Individuals 163,438 

• Partnerships 

15,373 

• Bodies of Persons etc. 

1,932 

• Employees paying income tax under Pay-As-You-Earn (PAYE) Scheme 324,268 

(as at 31-03-2007) 

Total Income Taxpayers 529,861 

Employers Registered under PAYE Scheme 

Persons and Partnerships registered for Economic Service Charge (ESC) 

Persons registered for Value Added Tax (VAT) 

Persons registered for Debits Tax 

Betting Levy Files 

13,236 

8,910 

29,537 

854 

963 

Gaming Levy Files 4 

Total Number of taxpayers as at 31-12-2007 

583,365 

Note: (i) A separate file is not generally maintained in the Department in respect of any employee 

from whom remuneration tax is deducted under PAYE Scheme unless such employee has 

any other income. 

(ii).Individuals whose income is taxed at source as a final tax (such as interest on deposits, 

Treasury Bills, Dividends etc) are not included. 

7

2.2 Total Revenue Collection 

The increase of Rs. 54.9 Billion or 21.67% over that of the year 2006,was mainly due to the 

continuous efforts made during the year by further strengthening tax administration, streamlining 

tax incentives and exemptions, enhancing tax compliance, strengthening enforcement and prompt 

enactment of revenue related legislation. 

The ratio of the total Inland Revenue contribution to the Government revenue in the year was 

54.54%. However, the total revenue was little lower than the revenue estimate for the year under 

review. This is mainly due to the provision of tax concessions on import of several essential 

commodities to counter the rising cost of goods and services, and declined vehicle imports in the 

year because people preferred importation low value vehicles in the face of high import duty 

imposed on fuel inefficient vehicles as a measure of managing the impact of escalating oil prices. 

Further, the introduction of new provisions in relation to the electricity and gas sectors and the 

setback in the hotel sector, were the main contribution factors to the above situation in addition 

the negative growth in the manufacturing sector, taxation relief on Tsunami projects and 

suspension scheme to deemed exporters through TQB and EDB too brought about somewhat 

unfavorable results as against the previous years. There is a considerable decrease in the 

collection of VAT. Hotel sector did not develop up to the expected levels volume of imports had 

not been upwards trend compared to previous years. 

Certain tax concessions on VAT were granted on essential goods. The loss of Value Added Tax 

revenue anticipated through these concessions has been estimated at Rs. 2273 ♣ Million. 

A comparison of collection under each type of tax with the corresponding estimate is given in 

Table 02 and illustrates in Chart 01. The Cash Flow during the year is shown in the Table 03, and 

is illustrated by Chart 02. 

♣ Ministry of Finance Annual Report -2007 

8

Table -02 

Total Revenue Collection-2007 

Type of Tax 

Revenue Estimate 

Rs: 

Revenue Collection 

Rs: 

Collection 

as a % of 

Estimate 

Collection 

as a % of 

Total 

Revenue 

Income Tax 99,479,000,000 94,964,974,986 95.46% 30.81% 

Economic Service Charge 14,345,000,000 12,203,425,025 85.07% 3.96% 

Debits Tax 8,141,000,000 7,186,742,288 88.28% 2.33% 

Betting & Gaming Levy 500,000,000 267,573,250 53.51% 0.09% 

Share Transaction Levy 400,000,000 412,083,582 103.02% 0.13% 

Stamp Duty 4,200,000,000 4,026,242,048 95.86% 1.31% 

Capital Transfer 100,000,000 7,532 0.01% 0.00% 

Construction Industry Levy 30,000,000 56,449,361 188.16% 0.02% 

Value Added Tax 201,643,000,000 186,990,550,020 92.73% 60.67% 

Goods & Services Tax 142,172,771 0.05% 

Turnover Tax 100,000,000 461,361,956 461.36% 0.15% 

National Security Levy 105,013,759 0.03% 

Total 328,938,000,000 306,816,596,578 93.27% 99.55% 

Social Responsibility Levy 892,000,000 1,388,930,385 155.71% 0.45% 

Total Revenue 329,830,000,000 308,205,526,964 93.44% 100.00% 

Chart 01 

Total Revenue Collection- 2007 

200,000 

VAT 

IT 

180,000 

ESC 

Rs: Millions 

160,000 

140,000 

120,000 

100,000 

80,000 

60,000 

40,000 

20,000 

0 

IT 

ESC 

DT 

B&GL 

STL 

SD 

CT 

Type of Tax 1 

CIL 

GST 

TT 

NSL 

SRL 

DT 

B&GL 

STL 

SD 

CT 

CIL 

VAT 

GST 

TT 

NSL 

SRL 

9

Table -03 

Cash Flows- 2007 

Month 


Rs: 

SRL (RS.) 

Cumulative Revenue 

Collection Rs: 

January-07 22,706,315,593 522,872.31 22,706,838,465 

February-07 24,055,427,147 3,735,534.80 46,766,001,147 

March-07 20,538,476,396 665,406.21 67,305,142,949 

April-07 24,318,955,838 782,558.36 91,624,881,346 

May-07 24,614,878,115 92,764,020.40 116,332,523,481 

June-07 20,506,064,107 12,227,870.41 136,850,815,458 

July-07 25,707,208,267 10,271,752.03 162,568,295,478 

August-07 31,610,773,198 236,151,214.85 194,415,219,890 

September-07 28,193,115,392 630,333,074.20 223,238,668,357 

October-07 29,506,455,866 147,847,097.20 252,892,971,320 

November-07 29,439,756,981 236,607,542.30 282,569,335,843 

December-07 25,619,169,678 17,021,442.95 308,205,526,964 

Chart 02 

Cash Flow-2007 

350,000 

300,000 

250,000 

Rs: Million 

200,000 

150,000 

100,000 

50,000 

- 

1 2 3 4 5 6 7 8 9 10 11 12 

Months 


Cummulative Revenue Collection 

10

2.3. Income Tax Collection 

Income tax collection for the year was Rs. 94.96 Billion. This is an increase of 30.99% over that 

of the previous year. The Income tax collection accounts for 30.52% of the total revenue of the 

Department. 

‣ During the year, several policy measures were introduced to rationalize the income 

taxes, which gave positive and negative results to the income tax collection. 

‣ During the year, gross Income Tax collection from employees (Under PAYE Scheme) 

recorded Rs. 11.2 Billion. Withholding Tax on Interest at 10% and Specified Fees at 

5% generated Rs.25.4 Billion and Rs.9.9 Billion respectively. 

2.3.1 Corporate and Non-corporate Income Tax 

Out of the total collection of Rs.94.96 billion, the contribution from the corporate sector amounted 

to Rs. 43.45 billion or 45.75 % whereas the non corporate sector contribution amounted to 

Rs.51.52 billion or 54.25%. 

Table 04 shows the composition to Income Tax collection, and Chart 03 illustrates the same with 

percentages. 

Table - 04 

Corporate and Non-corporate Income Tax Collection -2007 

Sector Tax Collection (Rs:) % 

Corporate 43,447,026,332 45.75% 

Non-Corporate 51,517,948,654 54.25% 

Total 94,964,974,986 100.00 

Chart 03 

Income Tax collection 2007 

Non- 

Corporate, 

54% 

Corporate, 

46% 

11

2.3.2 Source wise Analysis of Income Tax Collection 

Table 05 shows the source wise composition (employment and others) of income tax 

collected during the year. 

Table 05 

Income Tax Collection- 2007 

Source wise Analysis (Employees and Others) 

Source 

Collection (Rs. Mn) 

Employment 

PAYE Scheme 11,075.1 0 

Self Assessment and Assessments 

with penalties for tax in default 278.2 11,353.3 

Others 

Self Assessment and Assessments 

with penalties for tax in default 45,728.1 

Withholding Tax on Interest, Rent & 

Specified Fees 35,317.8 

Other Deductions at Source 2,816.9 

Compounding Penalties 0.3 83,863.1 

Gross Collection 95,216.4 

Less: Refunds (251.2) 

Net Collection 94,965 

2.3.3 Income Tax Return Filing Compliance 2002/2003 to 2006/2007 

The programme for enhancing taxpayer compliance in timely filing tax returns and paying 

taxes on self assessment basis continued during the year under review. 

Table 06 

Income Tax Return Compliance 2002/03 to 2006/07 

Year of 

Assessment 

Sector 

Compliance 

on Due Date 

% 

Compliance after 

one month from 

the due date 

% 

Corporate 31% 48% 

2002/2003 Non-corporate 32% 47% 


2003/2004 Non-corporate 32% 41% 


2004/2005 Non-corporate 28% 41% 


2005/2006 Non-corporate 33% 44% 


2006/2007 Non- corporate 26% 42% 

12

2.3.4 PAYE Returns Filing Compliance-2006/2007 


Assessments 

Table 07 

PAYE Returns Filing Compliance-2006/2007 

Description 

Compliance as at 

30/04/2007 

Compliance as at 

31/12/2007 

2006/2007 PAYE Returns 18% 47% 

2.4 Economic Service Charge 

During the year, 2351 new ESC files were opened making the total to 8910 as at 31-12-2007. ESC 

amounting to Rs. 12,203 Mn contributed 3.96% to the total collection. It is an increase of 37.8% 

and Rs. 3,350.5 Mn over that of 2006. Notices of assessments, 5114 in number were issued in 

respect of non payment of taxes on the return while 1,136 notices of assessments on others were 

issued during the year. A shortage of around 15% in the collection of ESC as against the estimate 

and this could be attributable to amendments made to the law during the mid of the year. 

Table 8 

Corporate and Non Corporate Economic Service Charge Collection – 2007 

ESC Collection (Rs.) % 

Corporate 11,148,253,944 91.35 

Non Corporate 1,055,171,080 8.65 

Total 12,203,425,024 100.00 

Chart 05 

Economic Service Charge Collection - 2007 

Non Corporate 

Sector, 9% 

Corporate Sector, 

91% 

13

2.5 Value Added Tax Collection 

The Value Added Tax (VAT) collection of Rs. 186.99 Billion during the year indicates a shortfall 

of Rs: 14.6 Billion over the estimated amount of Rs: 201.6 Billion for the year. However, this is 

an increase of Rs: 22.9 billion or 13.96% over that of the previous year. VAT represents 60.67% 

of the total revenue collection in the year. The number of permanent VAT registered persons 

rose up to 29,537 with the opening 2,819 new VAT files during the year. 

In order to maintain revenue at desired level, restrictions were introduced in relation to deduction 

of input tax, to the lower of actual input tax or 85% of the output tax, with carry forward 

provisions of the balance. 

However these restrictions are not applicable to- 

‣ any supplier whose supplies are zero rated; 

‣ any supplier who is registered with TQB or EDB for the supply of goods or certain 

services to exporters; 

‣ any person registered under Sec. 22 (7) of the VAT Act. 

Further, provisions were introduced to withhold 1 / 3 of VAT payable to contractors and any other 

service providers, on supplies made to Government Agencies. 

In order to mitigate the impact of undervaluation, the markup applicable on CIF value on 

importation has been increased to 10%. 

VAT Rate Changes 

‣ VAT payable on ticketing machine (used in Busses) tax was reduced by 5%; 

‣ VAT payable on supply of Jewellery was reduced from 20% to 5% w.e.f. 01.01.2007; 

‣ VAT payable on high tech Medical equipment was reduced to 5% from 15%. 

VAT Exemptions 

‣ Production, Distribution and exhibiting of any film; 

‣ Supply of laboratory services for film industry; 

‣ Importation of any film produced in Sri Lanka and taken abroad for further 

processing or printing with the approval of the NFC; 

‣ Chartering of Vessels; 

‣ Importation of any Bus by any Bus owner holding a valid route permit; 

‣ Supply of electricity, generation and distribution of electricity w.e.f.01.01.2007; 

‣ Machinery and equipments imported by Ceylon Electricity Board (CEB) and 

private power suppliers; 

‣ Import or supply of furnace oil; 

‣ Supply of locally manufactured Handloom textile w.e.f.01.01.2007; 

‣ Machinery imported for modernization of Tea Rubber and Coconut Processing; 

14

‣ Supply of prawns, importation of cattle, buffaloes etc. and livestock breeding 

items. 

In addition, steps were taken to streamline and expedite the refund process that witnessed 

considerable delays. Table 09 shows the Value Added Tax gross collection and refunds, and 

Table 10 shows the Value Added Tax (net) Collection sector wise, and is illustrated by Chart 05. 

Table 10 (a) shows the Domestic VAT Industry Wise analysis which highlights the increase in the 

year compared to 2006 in all domestic sectors such as Banking, Insurance, Hotel & Restaurant, 

Construction, Electricity & Gas, Imports and Financing. Collection of VAT on imports in the year 

reached to Rs. 101.5 Billion recording 54.28% out of total collection of VAT. 

Table 09 

Value Added Tax gross collection and refunds. 

Sector 

Gross Collection 

(Rs.Mn) 

Refunds (Rs.Mn) Net Collection (Rs.Mn) 

Manufacturing 32,482 9,959 22,523 

Non- Manufacturing 62,966.9 - 62,966.9 

Imports 101,500.9 0.339 101,500.6 

Total 196,949.8 9,959.339 186,990.5 

Table 10 

Value Added Tax Collection 

Sector 

Net Collection 

% of VAT Collection to GDP 

% 

(Rs:) 

2007 2006 

Manufacturing Sector 22,523,044,458 12.05% 0.6296 0.756 

Non Manufacturing Sector 62,966,901,977 33.67% 1.7601 1.68 

On Imports 101,500,603,584 54.28% 2.8372 3.1467 

Total 186,990,550,019 100% 5.2269 5.5827 

Chart 05 

Value Added Tax Collection-2007 

Manufacturing 

Sector, 12% 

On Imports, 54% 

Non-Manufacturing 

Sector, 34% 

15

Table 10 (a) 

Gross Domestic VAT – Main Manufacturing and Service Sectors 

Year 2006 

(Rs.Mn) 

Year 2007 

(Rs.Mn) 

% 

Increase/decrease 

Banking 7,400.82 9,689.07 31% 

Insurance 2,402.60 3,264.29 36% 

Hotel & Restaurant 2,028.02 2,364.22 17% 

Construction 3,828.15 6,408.16 67% 

Electricity & Gas 3,106.62 543.45 -83% 

Imports 6,439.82 9,620.29 49% 

Financing 5,541.82 7,530.80 36% 

Communication 4,570.92 5,139.21 12% 

Petroleum Product 1,307.41 2,878.38 120% 

Beverage –Alcoholic 5,694.06 6,466.00 14% 

Services not classified 4,800.59 5,854.48 22% 

Manufacturing not classified 4,127.29 5,582.66 35% 

Others 31,522.88 30,033.99 -5% 

Total 82,771.00 95,375.00 15% 

2.6 Stamp Duty Collection 

Rs. 4,026 Mn generated from Stamp Duty during the year. This is an increase of 169.3% over that 

of previous year. 

During the year an Order under Section 5 of the Stamp Duty Act was made to exempt documents 

for the issue or transfer of units of unit trusts or mutual funds. 

Moreover, 159 numbers of advisory and supervisory visits have been made. 

Following table highlights the percentages of the Stamp Duty collected from different 

instruments. 

Table 11 

Instrument wise analysis of stamp duty 

Type of Instrument 

Percentages 

Policy of Insurance 0.44% 

Licenses 0.43% 

Credit Card Transactions 21.04% 

Lease, Rent or Hire 32.85% 

Receipts for Remuneration 2.97% 

Other Receipts 16.63% 

Share certificates 25.16% 

North and East Provinces 0.21% 

Other 0.24% 

Total 100% 

16

2.7 Betting & Gaming Levy Collection 

During the year, collection of Betting and Gaming Levy was marginally declined by Rs. 14.6 Mn 

when compared with that of 2006. Though Betting Levy rates have been increased during the 

previous year, the collection of Betting & gaming Levy recorded only Rs. 267.6 Mn during the 

year. 

Table 12 compares the revenue estimate of Betting & Gaming Levy with the collection for the 

year, and Chart 06 illustrates it. 

Table 12 

Collection of Betting & Gaming Levy- 2007 

Revenue Estimated (Rs:) Revenue Collected (Rs:) % 

500,000,000 267,573,250 53.51 

Chart 06 

Collection of Betting & Gaming Levy 2007 

Rupees 

500,000,000 

400,000,000 

300,000,000 

200,000,000 

100,000,000 


Estimated 


Collection 

- 

1 

Betting & Gaming Levy 

2.8 Debits Tax Collection 

Debits Tax generated Rs. 7,186.7 Mn and constituted 2.33% of the total revenue collection in the 

year. Debits Tax collection was only marginally below the target of Rs.8,141 Mn set for the year. 

However, Debits tax collection of the year reflects a 14.9% growth over the corresponding 

collection in 2006. 

Table 13 compares the revenue estimate of Debits Tax with the revenue collected in the year, and 

the Chart 07 illustrates it. 

Table 13 

Debits Tax Collection - 2007 

Estimated Revenue 

(Rs:) 


(Rs:) % 

8,141,000,000 7,186,742,288 88.28 

17

Chart 07 

Debit Tax Collection -2007 

9,000 

8,000 

7,000 

Rs. Million 

6,000 

5,000 

4,000 

3,000 

2,000 

1,000 

- 

Estimated 


1Debit Tax 


Collection 

2.9 Share Transaction Levy 

Share Transaction Levy contributed Rs. 412 Mn marginally declining from Rs. 420.2 Mn 

collected in the previous year. 

The Table 14 shows the estimate for the year and the amount collected. 

Table 14 

Share Transaction Levy - 2007 

Estimated Revenue (Rs:) Revenue Collection (Rs:) % 

400,000,000 412,083,582 103.02 

2.10 Construction Industry Fund Levy 

Revenue collection from Construction Industry Fund Levy, exceeded the Revenue estimate by Rs. 

26 Mn or 88% by contributing Rs. 56 Mn to the total Revenue. 

Finance Act No. 5 was amended to empower the Commissioner General of Inland Revenue to 

administer the Construction Industry Fund Levy. 

2.11 Inland Revenue Collection 2003 to 2007 

Figures in Table 15 represent the tax wise classification of revenue collection of the Department, 

from 2003 to 2007. 

18


Table 15 

Inland Revenue Collection 2003 to 2007 – Tax wise Analysis 

2003 2004 2005 2006 2007 

Colln. % Colln. % Colln. % Colln. % Colln. 

(Rs.Mn) (Rs. Mn) 

(Rs. Mn) (Rs.Mn) (Rs.Mn) 

% 

Income Tax 

Economic Service 

Charge 

Value Added Tax 

Debits Tax 


Share Transaction Levy 

Turnover tax 

Stamp Duty 

Estate Duty 

Goods & Services Tax 

National Security Levy 

Construction Industry 

Social Responsibility 

Levy 

38,602 

- 

97,754 

3,601 

56 

- 

4 

69 

- 

(759) 

(284) 

27.76 

70.30 

2.59 

0.04 

0.00 

0.05 

-0.55 

-0.20 

37,904.0 

4,052.8 

117,030.9 

4,488.8 

77.1 

- 

106.2 

51.3 

0.4 

852.6 

239.9 

23.00 

2.46 

71.01 

2.72 

0.05 

0.06 

0.03 

0.00 

0.52 

0.15 

42,154.8 

7,283.1 

141,877.9 

5,700.8 

196.4 

451.2 

143.1 

8.9 

0.5 

448.9 

34.6 

21.26 

3.67 

71.55 

2.87 

0.10 

0.23 

0.07 

0.00 

0.00 

0.23 

0.02 

71,481.5 

8,852.9 

164,070.8 

6,254.8 

282.2 

420.2 

232.6 

1,495.2 

0.6 

135.7 

92.6 

28.22 

3.49 

64.77 

2.47 

0.11 

0.17 

0.09 

0.59 

0.00 

0.05 

0.04 

94,965 

12,203 

186,991 

7,187 

268 

412 

461 

4,026 

0 

142 

105 

56 

1,389 

30.8 

1 

3.96 

60.6 

7 

2.33 

0.09 

0.13 

0.15 

1.31 

0.00 

0.05 

0.03 

0.02 

0.45 

139,043 100 164,804 100 198,300 100 253,319 100 308,205 

100 

2.12 Inland Revenue Contribution to the Government Revenue and Gross 

Domestic Product (GDP) 

Table 16 shows the contribution of the Inland Revenue Department to the Government revenue 

and the GDP, in 2007 and its trends in the last 4 years. Chart 08 illustrates these contributions. 

Total Government revenue in 2007 has increased to Rs. 565,051 Mn (as per the Annual Report of 

Central Bank of Sri Lanka -2007) while the ratio of the total Inland Revenue collection to the 

Government revenue, continued its increasing trend and reached 54.54% in the year. The ratio of 

Departments collection to GDP is in the increasing direction. 

19

Year 

Table 16 

Contribution to the Government Revenue and GDP at Current Factor Prices 

Governments 

Revenue Rs. Mn 

IRD's Collection 

Rs.Mn 

% of IRD's 

Collection to 

Govt. 


GDP at Current 

Prices of Major 

Economic Activities 

Rs.Mn 

% of IRD's 

Collection to 

GDP 

2003 276,465 139,044 50.29% 1,822,468 7.63% 

2004 311,473 164,803 52.91% 2,090,841 7.88% 

2005 379,747 198,301 52.22% 2,452,782 8.08% 

2006 477,334 253,319 53.07% 2,938,656 8.62% 

2007 565,051* 308,205 54.54% 3,577,438** 8.61% 

*Source – Central Bank of Sri Lanka (Annual Report- 2007) 

Provisional Figures 

** Source – Central Bank of Sri Lanka (Annual Report- 2007) 

Department of Census and Statistics 

Chart 08 

Contribution of the IRD's Collection to the Government 

Revenue 2003 to 2007 

600,000 

500,000 

Rs. Million 

400,000 

300,000 

200,000 

100,000 

- 

2003 2004 2005 2006 2007 

Years 

Government Revenue 

IRD Collection 

20

CHAPTER 3 

EXPENDITURE AND PRODUCTIVITY RATIO 

Total expenditure of the Department in the year reached Rs. 1,208 Mn recording a 10% increase 

compared to the previous year figure Rs.1,084 Mn. Out of the total expenditure, 90% or Rs. 1,090 

Mn was incurred as recurrent expenditure which is an increase of 31.6% over Rs. 746 Mn in 

2006. Expenditure on emoluments increased by 34% to 877Mn from 579Mn in 2006, mainly due 

to the new recruitments (of Assessors and Tax Officers) during the year. This was the highest 

single expenditure item which accounted for 72.59% of total expenditure and 80% of recurrent 

expenditure. 

Capital expenditure during the year discontinued its increasing trends recording a drastic decrease 

of 65% compared to 2006 and reached Rs. 117Mn. This is mainly due to the decrease in 

“Acquisitions”. However, with the intention of increasing the productivity of the Department, 7 

Motor Vehicles, Computers and 55 Photocopy Machines were purchased during the year. In 

addition to the items of “Reconstruction and Improvements” and “Acquisitions”, Rs. 3.6Mn was 

incurred on “Skill Development Program” which was not an item reflected in previous years. 

Audits carried out by the Internal Audit Branch included examining of all payment vouchers 

relating to capital and recurrent expenditure, daily vehicle running charts maintained by the Head 

office and Regional office, pay sheets, the Board of Survey reports, the Appropriation Account for 

the year 2006 and refund of VAT. Moreover, submission of replies to the audit quires raised by 

the Auditor General, examining the action taken to recover the amounts due on dishonored 

cheques, checking of salary conversions under Public Administration Circular No. 6/2006(1), 

examining the revenue accounts relating to VAT and Income Tax and the examining the refund of 

taxes were the other main tasks performed by the Internal Audit Branch. After carrying out the 

above functions recommendations have been made to minimize the deficiencies observed in their 

examinations. 

21

3.1 Comparison of the total expenditure incurred during the year with 2005 and 

2006. 

Table 17 

Total Expenditure- 2005, 2006 and 2007 

Description 2005 (Rs:'000) % 2006 (Rs:'000) % 2007 (Rs:'000) % 

Recurrent Expenditure 

Emoluments 467,061 59.18% 579,251 53.42% 876,799 72.59% 

Traveling 4,105 0.52% 8,072 0.74% 11,385 0.94% 

Supplies & Equipments 20,595 2.61% 30,633 2.83% 34,857 2.89% 

Repairs & Maintenance 20,199 2.56% 28,877 2.66% 20,739 1.72% 

Contracted Services 62,484 7.92% 81,174 7.49% 138,523 11.47% 

Transfers 649 0.08% 779 0.07% 8,068 0.67% 

Other Recurrent Exp. 42,195 5.35% 17,303 1.60% - 0.00% 

Modernization Programme - 0.00% - 0.00% - 0.00% 

Sub Total 617,288 746,089 1,090,371 

Capital Expenditure 

Reconstruction and Improvements 13,290 1.68% 22,986 2.12% 43,207 3.58% 

Acquisitions 158,641 20.10% 315,158 29.07% 70,723 5.85% 

Skill Development - 0.00% - 0.00% 3,650 0.30% 

Sub Total 171,931 338,144 117,580 

Total 789,219 100% 1,084,233 100% 1,207,951 100% 

Chart 10 

Capital 

Expen 

diture, 

22% 

2005 

Capital 

Expen 

diture, 

31% 

2006 

Capita 

l 

Expen 

diture, 

10% 


Recurr 

ent 

Expen 

diture, 

78% 

Recurr 

ent 

Expen 

diture, 

69% 

Recurr 

ent 

Expen 

diture, 

90% 

22

3.2 Analysis of the Recurrent Expenditure in 2007 

Chart 11 

Recurrent Expenditure 2007 

Contracted 

Servises, 13% 

Transferes, 1% 

Other Recurrent 

Expenditure, 0% 

Repairs & 

Maintenance, 2% 

Supplies & 

Equipments, 3% 

Traveling, 1% 

Emoluments, 80% 

3.3 Productivity Ratio 

The total expenditure of the Department in the year was Rs. 1,207,951,000 and the Revenue 

collected was Rs. 308,205,526,964. The Productivity Ratio (i.e. the revenue collected for every 

rupee of expenditure) therefore, works out to 255:1. In other words, the cost of collection of Rs. 

100 was 39 cents. Even though the total expenditure of the Department in the year recorded a 

10% increase, the cost of collection per Rs.100 recorded 9.3% decrease as the total revenue 

collection grown up by 22%, when compared with 2006. The Cost of collection per Rs. 100, 

excluding VAT on Imports accounted 58 cents. Table 18 provides a classification of Revenue 

Collection, Total Expenditure and the cost of collection from the year 2005 to the year 2007. 

23

Table 18 

Revenue Collection, Total Expenditure and Cost of Collection (Rs. Mn) 


Income Tax 

Economic Service Charge 


Debits Tax 


Share Transaction Levy 

Turnover Tax 

Stamp Duty 

Estate Duty 

Goods & Services Tax 

National Security Levy 

Construction Industry 

Social Responsibility Levy 

2005 2006 2007 

42,154.8 

7,283.1 

141,877.9 

5,700.8 

196.4 

451.2 

143.1 

8.9 

0.5 

448.9 

34.6 

- 

- 

71,481.5 

8,852.9 

164,070.8 

6,254.8 

282.2 

420.2 

232.6 

1,495.2 

0.6 

135.7 

92.6 

- 

*** 

94,964.9 

12,203.4 

186,990.6 

7,186.7 

267.6 

412.1 

461.4 

4,026.2 

0 

142.2 

105.0 

56.5 

1,388.9 

Total 198,300.2 253,319.1 308,205.5 

Expenditure 

Recurrent Expenditure 

Emoluments 

Traveling 

Supplies & Equipment 

Repairs & Maintenance 

Contracted Services 

Transfers 

Others 

467.1 

4.1 

20.6 

20.2 

62.5 

0.6 

42.2 

579.3 

8.1 

30.6 

28.8 

81.1 

0.8 

17.3 

876.8 

11.4 

34.9 

20.7 

138.5 

8.1 

- 

Capital Expenditure 

Reconstruction & Improvements 

Acquisitions 

Skill Development 

13.3 

158.6 

- 

22.9 

315.2 

- 

43.2 

70.7 

3.6 

Total Expenditure 789.2 1,084.1 1,207.9 

Cost of Collection per Rs.100, Rs. 0.40 0.43 0.39 

Cost of Collection per Rs. 100, excluding VAT on Imports, Rs. 0.58 

*** Included under Income tax. 

24

CHAPTER 4 

TAXES IN DEFAULT 

Table 19 shows the amounts of Taxes in default, the taxes held over and the collectible taxes in 

default, as at 31-12-2007. 


Income Tax 

Gross Tax in 

Default 

Rs. 

Table 19 

Analysis of the default taxes 

Total 

Penalty * 

Rs. 

Total Default 

Tax without 

Penalty 

Rs. 

Disputed Tax 

without 

Penalty 

Rs. 

Collectible Tax 

(without 

penalty) 

Rs. 

56,116,027,728 16,135,372,663 39,980,655,065 23,055,561,724 16,925,093,341 

Surcharge on Income 

Tax 

1,462,506,074 311,594,266 1,150,911,808 360,683,142 790,228,666 

Value Added Tax 76,765,683,735 20,455,190,044 56,310,493,691 37,897,340,419 18,413,153,272 

VAT on Financial 

Service 

292,596,103 45,500,385 247,095,718 247,095,718 - 

Economic Service 

Charge 

3,549,754,707 943,329,146 2,606,425,561 97,326,949 2,509,098,612 

Wealth Tax 109,987,698 - 109,987,698 57,285,177 52,702,521 

Surcharge on Wealth 

Tax 

3,677,694 - 3,677,694 2,141,423 1,536,271 

Gift Tax 16,009,967 - 16,009,967 5,298,381 10,711,586 

Estate Duty 35,830,929 11,945,542 23,885,387 - 23,885,387 

Stamp Duty 70,960,648 - 70,960,648 70,960,648 - 

Goods & Services Tax 8,859,880,017 1,932,203,337 6,927,676,680 1,932,203,337 4,995,473,343 

Turnover Tax 6,714,339,116 1,899,187,994 4,815,151,122 1,437,228,290 3,377,922,832 

National Security 

Levy 

4,761,641,085 1,199,366,565 3,562,274,520 1,058,370,528 2,503,903,992 

Save the Nation 

Contribution 

53,341,590 11,071,094 42,270,496 3,036,400 39,234,096 

Betting & Gaming 

- - - - - 

Levy 

Compounding Penalty 13,637,224 - 13,637,224 13,637,224 - 

Obsolete Taxes 4,644 - 4,644 4,644 - 

Social Responsibility 

Levy 

184,227 - 184,227 - 184,227 

158,826,063,186 42,944,761,036 115,881,302,150 66,238,174,004 49,643,128,146 

* Penalties of Metro Branches and Regional Offices have not been included. 

25

CHAPTER 5 

INTERNATIONAL RELATIONS 

5.1 Double Tax Treaties 

Tax Treaties eliminate or mitigate the incidence of juridical double taxation and the fiscal evasion, 

and are considered as vital in international tax matters. These Treaties are particularly important 

for developing countries as they play a great role in attracting foreign investments, expertise, 

modern technology etc. 

Sri Lanka has as at 31-12-2007 entered into tax treaties with 37 countries as referred to in the 

following Table. 

Table - 20 

The countries with which tax treaties are in force as at 31-12-2007 

Country 

Date of 

Signing the 

Agreement 

Gazetted 

Gazette No. 

Date 

Operative in Sri 

Lanka From the 


Assessment 

1 Australia 18-Dec-1989 657/2 8-Apr-1991 1992/93 

2 Bangladesh 24-Jul-1986 448/13 7-Apr-1987 1989/90 

3 Belgium 3-Feb-1983 292/6 9-Apr-1984 1984/85 

4 Canada 23-Jun-1982 253/8 13-Jul-1983 1986/87 

5 China 11-Aug-2003 1374/20 6-Jan-2005 2006/07 

6 Denmark (Rev.) 22-Dec-1981 228/15 20-Jan-1983 1980/81 

7 France 17-Sep-1981 210/17 17-Sep-1982 1982/83 

8 Finland 18-May-1982 253/8 13-Jul-1983 1981/82 

9 Germany (Rev.) 13-Sep-1979 113 31-Oct-1980 1982/83 

10 Hong Kong (Limited) 26-Mar-2004 1374/21 6-Jan-2005 2005/06 

11 India (Rev.) 27-Jan-1982 210/17 17-Sep-1982 1980/81 

12 Indonesia 3-Feb-1993 789/10 21-Oct-1993 1995/96 

13 Iran 25-Jul-2000 1187/16 6-Jun-2001 2002/03 

14 Italy 28-Mar-1984 322/4 5-Nov-1984 1978/79 

15 Japan 12-Dec-1967 14803/5 29-May-1968 1969/70 

16 Korea 28-May-1984 342/11 29-Mar-1985 1980/81 

17 Kuwait 5-Feb-2002 1245/19 18-Jul-2002 2002/03 

18 Malaysia (Rev.) 16-Sep-1997 1028/21 22-May-1998 99/2000 

19 Mauritius 12-Mar-1996 958/10 15-Jan-1997 1998/99 

20 Nepal 6-Jul-1999 1116/6 26-Jan-2000 2001/02 

21 Netherlands 17-Nov-1982 281/13 26-Jan-1984 1979/80 

22 Norway (Rev.) 1-Dec-1986 464/4 27-Jul-1987 1989/90 

23 Oman (Limited) 26-Jul-1994 881/7 26-Jul-1995 1979/80 

24 Pakistan (Rev.) 15-Oct-1981 210/17 17-Sep-1982 1983/84 

25 Poland 25-Apr-1980 130 27-Feb-1981 1984/85 

26 Qatar 7-Nov-2004 1422/10 5-Dec-2005 2008/09 

27 Romania 19-Oct-1984 371/9 15-Oct-1985 1986/87 

28 Russia 2-Mar-1999 1101/22 15-Oct-1999 2003/04 

29 Saudi Arabia (Limited) 16-Dec-1999 1101/23 15-Oct-1999 1983/84 

30 Singapore 29-May-1979 57/11 10-Oct-1979 1977/78 

31 Sweden (Rev.) 23-Feb-1983 297/28 18-May-1984 1985/86 

32 Switzerland 11-Jan-1983 292/6 9-Apr-1984 1981/82 

33 Thailand 14-Dec-1988 571/16 18-Aug-1989 1990/91 

34 U.A.E. (Limited) 7-Jul-1992 824/13 23-Jun-1994 1979/80 

U.A.E. (Comprehensive) 24-Sep-2003 1346/1 21-Jun-2004 2004/05 

35 U.K. 21-Jun-1979 60/23 2-Nov-1979 1977/78 

36 U.S.A 14-Mar-1985 398/4 22-Apr-1986 

U.S.A. Protocol 20-Sep-2002 1298/8 21-Jul-2003 2004/05 

37 Vietnam 26-Oct-2005 1455/9 24-Jul-2006 2007/08 

27

Affairs related to tax treaties during the year 2007- 

Agreement with Austria 

The first round of negotiations between Sri Lanka and Austria held in Vienna during the March, and the 

second round of negotiations in Colombo, during September 2007, concluding the Officials’ level of 

negotiations. 

Agreement with Qatar 

The agreement entered into force on May 03, 2007. Accordingly, the agreement is applicable in Sri Lanka 

for the year of assessment 2008/09 onward. 

New Proposals- 

Proposals from Croatia, Ukraine, Saudi Arabia and Luxembourg were received during the year and 

preliminary studies on the importance of entering into such agreements with those countries were 

completed. 

5.2 Participations at International Taxation Matters Abroad 

Mr. A.A.Wijepala CGIR Negotiation on Double 

Austria 06-09 Mar. 2007 

Taxation Agreement 

Mr. H.B.A. Seneviratne CIR Negotiation on Double 



Miss. DGPW Gunatillake DC Negotiation on Double 



Mr. D U A Jayawardana SA Negotiation on Double 



28

6.1 Legislation made during the year 

CHAPTER 6 

LEGISLATION 

i. Inland Revenue (Amendment) Act No. 10 of 2007. 

ii. Value Added Tax (Amendment) Act No. 14 of 2007. 

iii. Economic Service Charge (Amendment) Act No. 15 of 2007. 

iv. Debits Tax (Amendment) Act No. 12 of 2007. 

v. Finance Act No. 13 of 2007 to amend the law relating to the Motor Vehicle 

Concessionary Levy and Construction Industry Guarantee Fund Levy. 

vi. 

Finance Act No. 45 of 2007 to amend the law relating to the Social 

Responsibility Levy. 

6.2 Rulings Given During The Year 

Relevant 

Section of the Act 

Description 

Ruling Number 

Section 35(2) (IT Act No. 10 

of 2006) 

Section 76 (IT Act No. 10 of 

2006) 

Section 102 (IT Act No. 10 


Section 26(1)/ 25(1)(o) (IT 

Act No. 10 of 2006) 

Section 25 F (b) (VAT Act 

No.14 of 2002) 

First Schedule (VAT Act 

No.14 of 2002) 

Section 83 (VAT Act No.14 


Section 2 (3)(b) (ESC Act 

No. 13 of 2006) 

Tax Payable on Compensation for loss of Rul /IT / 2007/ 06 

office or employment 

Liability of a Co-ownership to Partnership Rul/ IT / 2007/ 07 

Tax 

Definition of NGO Rul/ IT / 2007/ 09 

Payment of Gratuity via a provision Rul/ IT / 2006/ 10 

account vis-à-vis A separate fund 

Falls under the Financial VAT or Normal Rul/ VAT/ 2007/ 04 

VAT 

Exemption for Diplomatic Personnel Rul/ VAT/ 2007/ 05 

Missions or Organizations 

Manufacture of CD-Rom Compact Disks Rul/ VAT/ 2007/ 06 

for Educational Purposes 

Turnover Liable to ESC Rul/ ESC/ 2007/ 06 

29

6.3 Approved Charities 

The following Institutions were declared as Approved Charities under Section 34(8) (a) of 

the Inland Revenue Act. No. 10 of 2006. 

Name and address of the organization Gazette Number Date 

1) Fund for Caring Poor Children of 1505 06.07.2007 

Arc-En-Ceil 

83, Sri Dhammadara Mawatha 

Ratmalana 

2) The Scholarship Fund for 1505 06.07.2007 

Higher Education of the 

Commercial Bank Social 

Responsibility Trust 

21, Bristol Street 

Colombo 01 

3) Sirisangabo Special Children’s 1485 15.02.2007 

Foundation 

Koongahawatta 

Kandy Road 

Pasyala 

4) Building Construction Fund 1530 28.12.2007 

of the Homagama Base Hospital 

Bamunuarachchi Foundation 

52, Sir Marcus Fernando Mw, 

Colombo 07. 

5) Fund to provide Financial Aid to 1522 02.11.2007 

Construct houses for the destitute 

of the International Social Service 

Organisation. 

30

CHAPTER 7 

AUDITS, ADDITIONAL TAX COLLECTIONS, RECOVERY ACTIONS AND APPEALS 

Audits and investigations are undertaken with a view to achieving the widest possible coverage of 

the taxpayer population, in terms of business activity, entity type and business size. It has been, 

however, found that the most productive use of investigate resources has been in respect of the 

largest taxpayers. In the year under review the selection process focused heavily on this category 

resulting in a notable increase in back duty. Accordingly, audit functions were carried out in a 

satisfactory level resulting in collection of an additional tax amounting to Rs.6.6 billion, in the 

year. 

7.1 Particulars of Audits and Additional Tax Collection during the year. (Rs: Mn) 

Income 

Tax 

PAYE 

Value 

Added 

Tax 

ESC Others Total 

Total amount of additional tax 

assessed during the year 4,681 323 7,259 438 28 12,731 

Total amount of additional tax 

collected during the year 2,433 149 3,540 374 215 6,711 

Number of Audit cases commenced 

during the year 2007 8,509 

Number of Audit cases finalized 

during the year 2007 5,343 

7.2 Additional information on Additional Taxes 

Description 

Additional 

Income/Turnover 

Assessed & 

Agreed (Rs:) 

Corporate- 

LTU (Rs:) 

Additional Tax Assessed & Agreed (Rs :) 

Corporate- 

Other Units 

(Rs:) 

Non 

corporate 

Units (Rs:) 

Total (Rs:) 

Additional 

Tax Collected 

(Rs:) 

Income 

Tax 19,939,083,504 3,782,680,189 348,213,846 550,297,345 4,681,191,380 2,433,056,703 

VAT 30,614,166,630 5,712,646,592 1,461,652,157 85,542,455 7,259,841,204 3,540,329,268 

ESC 32,900,613,189 169,509,358 261,708,162 6,631,989 437,849,509 373,525,233 

PAYE 6,096,773,669 230,007,273 93,405,343 - 323,412,616 149,126,055 

Others 3,874,069,947 23,370,684 5,442,428 - 28,813,112 214,907,619 

Total 93,424,706,939 9,918,214,096 2,170,421,936 642,471,789 12,731,107,821 6,710,944,878 

31

7.3 Appeals 

Appeals to the Commissioner General 

Income Tax 

Value Added 

Tax 

Others 

Balance as CGIR (Hearing ) 76 125 111 

at Units 252 29 24 

01.01.2007 Appeal Branch 58 05 03 

Registered (APL 2) during the year 617 688 225 

Determined ( CGIR) 22 79 69 

Finalized Units (APL 4) 373 289 127 

Appeal Branch 60 34 31 

Submitted for hearing (CGIR) 12 125 04 

Balance as CGIR (Hearing ) 66 171 46 

at Units 453 244 86 

31.12.2007 Appeal Branch 29 30 04 

7.4 Board of Review 

The position as regards appeals made to the Board of Review was as follows: 

Number of appeals pending before the Board of Review as at 01-01-2007 105 

Number of appeals lodged during the year 26 

Number of orders issued on conclusion of hearing 14 

Number of appeals outstanding as at 31-12-2007 117 

The Board of Review took up 24 cases for hearing during the year, although only 14 

orders were issued on conclusion. 

Cases stated during the year for the opinion of the Court of Appeal- 08. 

32

CHAPTER 8 

TAX PAYER SERVICES 

Several Taxpayer service activities were organized in parallel to the 75 th anniversary of the 

Department. “Payment of Tax is Your Duty” campaign was launched to mark this event. The 

campaign strategy was developed on the premise that the payment of taxes is the voluntary 

responsibility of a good citizen that deserves the recognition and respect personalities representing 

various professions, whose lucrative practices leave room for tax evasion was featured as spokes 

people who can set an example, by endorsing that “payment of tax is a duty and not an 

obligation”. The view that demonstrated was that the monies collected would be channeled for 

nation building which would benefited by the country and its citizens as a whole. The objectives 

of the campaign were to create a positive perception among the public towards the voluntary 

payment of taxes to the state, to communicate that payment of tax is a duty and not an obligation 

of all citizens and to emphasize the use of these funds would be used for greater development of 

the country. 

“Rata Venuven Api” campaign was to emotionally motivate voluntary payment of taxes and to 

communicate how the people voluntarily pay their taxes becomes stakeholders of nation building 

process. 

“Badhu Nogeuvoth Amaruwe” campaign was some sort of different message to compel tax 

evaders to pay taxes. This was a parallel campaign depicting typical tax evaders who were under 

Tax Department’s scrutiny for tax evasion, a subtle warning to evaders to switch on to voluntary 

tax payment and necessary communication in support of getting the hardcore evaders in to tax 

net. 

To achieve the objectives of the campaign the following communication vehicles were used. 

‣ Press 

Advertisements were published in Sinhala, Tamil and English in daily and weekend 

newspapers for 2 months from the end of March 2007. 

‣ Television Advertisements 

Telecast of an attractive commercial running for 30 seconds in Sinhala, Tamil and English 

on nine television channels, was received good responses 

‣ Hoardings 

Four hoardings were fixed at Colombo-Katunayake road, Parliament road, Nugegoda and 

Pettah. 

‣ Posters 

10,000 posters (of 4 different pictures) were displayed at selected institutions. 

‣ Brochures 

90,000 brochures were distributed among people by conducting an “Inland Revenue 

Walk” 

33

Introduction of certain tax benefits to individual taxpayers is a special feature witnessed by the tax 

system of Sri Lanka in the recent past. The main objectives of these tax benefits are to enhance 

the voluntary compliance towards the tax laws. 

The process of issuing privilege cards to compliant (individual) taxpayers to recognize their 

contribution (to the Government Revenue) and to make them entitled to certain moral benefits 

such as preferential treatments at the Government Agencies, continued with added modes. The 

primary objective of issuing privilege cards is to give certain recognition to those taxpayers who 

show optimum compliance on tax laws. During the year 252 Gold cards and 132 Silver cards were 

issued accordingly. 

The Taxpayer Service Unit housed on the ground floor of the Inland Revenue Building has been 

equipped with facilities for the sake of tax payers and the public to access conveniently. The unit 

is equipped with officers to assist every person seeking help or information. Relevant enactments, 

departmental publications, paying-in slip, forms etc. are available in this unit. During the year 

issuing 10,458 Temporary Identification Numbers, 2,437 Income Tax registrations, 2,819 VAT 

registrations and 1,735 PAYE registrations have been made during the year 2007. The temporary 

VAT certificates issued during the year 2007 were 14,279. 

34

Annexure I 

Specialized Training Programme on Audit & Investigation, International Taxation 

& Management at the National Academy of Direct Taxes (NADT) of India. 

From 15th - 26th Oct. 2007 - 

From 12th - 23rd Nov. 2007 - Mumbai From 3rd - 14th Dec. 2007 - Nagpur 

Nagpur 

Name Designation Name Designation Name Designation 

1 Mrs. D.M. Nandawathie Commissioner 1 Mrs. L. Ramanayake Commissioner 1 Mrs. M. Samarasekera Commissioner 

2 Mr. H.M. Abeysinghe Commissioner 2 Mr. W.M.W. Kumarasiri Commissioner 2 Mr. K.L.S. Silva Commissioner 

3 Mr. P.D. Premarathne Commissioner 3 Mr. A.L.A. Sirisena Commissioner 3 Mr. H.B.A. Seneviratne Commissioner 

4 Mr. S.T. Gobalasingham Commissioner 4 Mrs. H.M.C.I. Gunasekera Commissioner 4 Mr. H.M. Premaratna Banda Commissioner 

5 Mr. K.A.P. Kaluarachchi Commissioner 5 Mr. S. Rajapakshe Dy. Commissioner 5 Miss D.G.P.W. Gunathilake Dy. Commissioner 

6 Mrs. W.B.S. Shanthikumar Commissioner 6 Mr. A.A.D.U. Abeysinghe Dy. Commissioner 6 Mrs. C.H. Weerasinghe Dy. Commissioner 

7 Mr. P.A.V. Premaratne Dy. Commissioner 7 Ms. H.M.D. Munasinghe Dy. Commissioner 7 Mrs. K.M.S. Jayaweera Dy. Commissioner 

8 Mrs. K. Dahanayake Dy. Commissioner 8 Mrs. K.D.M.R. Silva Dy. Commissioner 8 Mr. H.M.G. Wijesinghe Dy. Commissioner 

9 Mr. K.A.G. Abayaratne Dy. Commissioner 9 Mrs. S.N.P. Abrew Dy. Commissioner 9 Mr. W.S.K. De Costa Dy. Commissioner 

10 Mr. D.B. Jayasekera Dy. Commissioner 10 Mrs. K.S.B.R.D.S. Karunaratne Dy. Commissioner 10 Mr. M.S.M. Fuward Dy. Commissioner 

11 Mrs. W. Anulawathie Dy. Commissioner 11 Mr. K.G. Piyatissa Dy. Commissioner 11 Mr. A.A. Dayaratne Dy. Commissioner 

12 Mrs. S. Edirisinghe Dy. Commissioner 12 Mr. O.P.P.K. Sirisena Dy. Commissioner 12 Mr. J. Ratnayake Dy. Commissioner 

13 Mr. I.M.B. Seneviratne Banda Dy. Commissioner 13 Mr. K. Dharmasena Dy. Commissioner 13 Mrs. Vijitha Paranamana Dy. Commissioner 

14 Mr. J.M. Jayawardena Dy. Commissioner 14 Mrs. B.A.D.D. Herath Dy. Commissioner 14 Mr. E.S. De Zoysa Dy. Commissioner 

15 Mr. S.A. Hemapala Dy. Commissioner 15 Mr. D.B. Dissanayake Dy. Commissioner 15 Mr. D.R.S. Hapuarachchi Dy. Commissioner 

16 Mr. K. Rajaratnam Dy. Commissioner 16 Mr. K.D.N.P. Koralearachchi Dy. Commissioner 16 Mrs. D.M. P. Ganepola Dy. Commissioner 

17 Mr. A. Sri Selvanayagam Dy. Commissioner 17 Mr. T.M. Dayananda Dy. Commissioner 17 Mr. R.S. Samaranayake Dy. Commissioner 

18 Mrs. R.M.R.W. Manchanayake Dy. Commissioner 18 Mr. P.M. Dissanayake Dy. Commissioner 18 Mr. G.C. Mahanama Dy. Commissioner 

19 Mr. D.M.L.I. Dissanayake Dy. Commissioner 19 Mr. B.G. Piyadasa Dy. Commissioner 19 Mr. K.D.M.N. Gunathunga Dy. Commissioner 

20 Mr. A. N. Guruge Dy. Commissioner 20 Mr. M.J. Gunasiri Dy. Commissioner 20 Mr. H.W. G. Pushpakumara Dy. Commissioner 

21 Mrs. P.Rohini Dy. Commissioner 21 Mr. H.M.W.C. Bandara Dy. Commissioner 21 Mrs. P. Hewage Dy. Commissioner 

22 Mrs. R.M.P.S.K. Rajapakse Dy. Commissioner 22 Mr. R.G. Dharmadasa Dy. Commissioner 22 Mr. S.S.D. Weerasekera Dy. Commissioner 

23 Mr. J.P.D.R. Jayasekera Dy. Commissioner 23 Mr. R.M. Jayasinghe Dy. Commissioner 23 Mr. T. Rajapakse Dy. Commissioner 

24 Mr. D.M.S. Dissanayake Dy. Commissioner 24 Mr. M.H. Densil Dy. Commissioner 24 Mr. B. Sivaji Dy. Commissioner 

25 Mr. M.G. Somachandra Dy. Commissioner 25 Mr. U.B. Wakkumbura Dy. Commissioner 25 Mr. M.S.M. Siyan Dy. Commissioner 

26 Mr. P.G.K. Samaratunga Dy. Commissioner 26 Mr. B.J. Jayaratne Dy. Commissioner 26 Mr. U.P.S.A. Jayalath Dy. Commissioner 

27 Mr. K.H.N.C. Perera Dy. Commissioner 27 Mr. M.L. Mohomad Thahir Dy. Commissioner 27 Mr. J.A.D. Sepala Dy. Commissioner 

28 Mr. P.L.A. Liyanage Dy. Commissioner 28 Mr. K.D.M. Ratnakumara Dy. Commissioner 28 Mrs. T.G.D.S. Jayawardane Dy. Commissioner 

29 Mr. J.A.A. Parakrama Dy. Commissioner 29 Mr. M.D.J.M. Devapriya Dy. Commissioner 29 Mr. T. Karunadasa Dy. Commissioner 

30 Mr. A.G. Sumanadasa Dy. Commissioner 

35 

35

DISTRIBUTION OF STAFF, FILES AND REVENUE AMONG THE ASSESSING DIVISIONS 

37 

Annexure II 

Assessing Divisions Staff Files 

37 

Revenue (RS. Mn) 

DC SA A STO TO Others Total IT B&G.L. D.T. PAYE ESC VAT IT & SRL TT DT SD ESC VAT &GST STL B&G Total 

International Unit 1 1 2 0 2 1 7 673 45 25 51 1,464 26 385 1,875 

Unit 1& 2 2 0 9 2 11 7 31 4,459 9 379 3 382 

Unit 3 

2 

8 48 18,579 159 159 

Unit 4 

2 1 21 

1 

14 

7 42 4,368 2,077 1,098 2,688 1,214 

533 2,487 4,242 

Unit 5 

2 1 18 

2 

13 

6 43 6,639 3,984 1,213 3,713 1,482 

8 

577 3,248 5,311 

Unit 6A 

2 2 18 

4 

13 

6 38 239 291 230 233 5,772 

4 

1,378 15,051 22,206 

Unit 6B 

2 1 12 

3 

13 

5 34 242 272 224 228 3,805 

5 

1,123 7,331 12,266 

Unit 6C 

2 1 10 

2 

13 

6 34 72 204 67 272 15,027 

7 

1,553 18,603 35,184 

Unit 7A 

1 1 11 

2 

13 

5 27 203 259 195 201 4,082 

1 

1,086 3,941 9,116 

Unit 7B 

2 1 9 

2 

8 

23 234 305 218 228 4,952 

7 

1,148 9,400 15,501 

Unit 8 

1 1 10 

6 

9 

6 30 238 287 231 239 13,625 

1 

1,306 12,277 27,264 

Unit 10 

2 2 9 

4 

5 

5 40 1,235 989 813 1,094 2,757 

56 

1,341 7,461 11,565 

Unit 12 

1 6 12 

5 

12 

5 40 7,110 3,287 961 3,951 1,370 

6 

590 3,173 5,138 

Unit 14 

2 1 14 

1 

13 

5 30 1,869 648 391 876 193 

5 

208 732 1,134 

Unit 15 

2 1 10 

1 

11 

4 28 1,944 588 425 1,014 426 

1 

276 1,230 1,932 

WHT on Specified Fees 

2 1 10 

3 

10 

9 43 9,965 

0 

9,965 

WHT on Interest 

1 1 

0 

15 

9 0 

14 

3 23 25,052 25,052 

PAYE 

1 

2 

10 

6 23 239 1,690 412 2,102 


1 2 

0 

6 

5 0 

6 

3 13 766 

268 418 

Debit Tax 

1 

4 

- 854 

150 

7,187 7,187 


GST 

Stamp Duty 

Regional Offices 

Colombo South 

4 3 

0 

27 

1 

0 

6 

2 

11 

3 

1 

3 

22 

3 

6 

12 71 14,749 5,883 5,883 

2 13 141 141 

7 29 3,182 3,182 

1 

7 42 10,675 179 379 70 449 

Colombo Central 

1 2 18 

2 

13 

10 47 15,130 372 306 166 472 

Colombo City 

1 1 22 

3 

11 

10 49 9,733 341 300 184 484 

Maharagama East 

1 5 16 

4 

14 

6 46 15,431 5 176 94 47 141 

Maharagama West 

1 1 24 

4 

10 

6 39 11,046 149 125 38 0 163 

Badulla 

1 1 19 

5 

8 

9 33 4,828 45 57 13 70 

Galle 

1 1 10 

6 

7 

14 38 5,752 20 170 79 56 135 

Kalutara 

1 1 12 

4 

4 

15 45 6,003 46 113 61 33 94 

Gampaha 

1 1 16 

12 

8 

5 41 12,554 170 132 62 194 

Matara 

1 1 

- 

20 

6 

2 

14 51 7,711 13 184 107 45 4 156 

Nuwara Eliya 

1 

24 

2 

6 

12 30 4,017 57 56 22 78 

Ratnapura 

1 

0 

1 9 

5 

5 

12 39 7,112 32 120 94 62 0 156 

Anuradhapura 

1 11 

3 

10 

13 41 5,777 90 77 

23 1 205 

Batticaloa 

1 

0 

1 

0 

12 

5 

11 

10 25 2,499 2 78 17 

104 

13 217 

Jaffna 0 0 

4 

0 

6 

0 5 6 3,722 21 4 

187 

0 28 

Kandy 1 

1 

10 

14 59 9,784 140 235 

24 

44 2 281 

Kegalle 1 

2 20 

5 

12 

11 36 4,247 6 108 42 12 1 55 

Kurunagala 1 

1 11 

5 

7 

16 55 8,471 58 51 193 29 222 

Matale 1 

1 19 

5 

13 

6 33 2,995 19 54 62 17 0 79 

Negombo 

1 

0 

11 

6 

9 

12 47 10,002 192 128 58 186 

1 

19 

9 

Total 

142 

324 1,505 205,832 967 854 13,236 8,910 29,537 95,962 

7,187 3,182 12,142 91,352 412 268 211,071 

53 48 550 

388 

566 

VAT on Imports 101,501 

Other Taxes (NSL,Other SRL etc.) 262 

Treasury Transfers 4,588 

sums credited by Accounts Branch 1,021 

318,443 

Less- Refunds (10,238) 

al Net Collection 308,205

Performance Report 2007 - Department of Inland Revenue

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