Business

Sri Lanka to begin VAT refunds for foreign tourists

The Inland Revenue Department (IRD) will refund foreign tourists the 15% Value Added Tax (VAT) they pay on goods purchased in Sri Lanka when they leave the island from tomorrow.

A special counter set up for this purpose at Bandaranaike International Airport (BIA) Departure Lounge will be declared open by Minister of Finance and Mass Media Mangala Samaraweera tomorrow afternoon.

Merchants who wish to be a part of this initiative will be required to register with the IRD, with 18 merchants having registered already.

A proposal of the 2018 Budget, this initiative is aimed at promoting tourism and promoting Sri Lanka as a trading hub of Asia, with the resultant development of the retail sector expected to increase foreign exchange to the country.

VAT refund systems are in place in many countries around the world.