Central & South Asia
Sri Lanka tax rates 2026
Residents are taxed on worldwide income, following sharp tax hikes in 2023. Personal tax is progressive up to 36%, corporate tax stands at 30%, and VAT is 18%.
Worldwide (residence-based)
Last verified
The taxes
| Personal income (top) | 36%Progressive, from 6% to 36%. The top rate kicks in at a relatively modest income following the 2023 reforms. |
|---|---|
| Corporate income | 30% |
| Capital gains | 10% on the realisation of investment assets. |
| VAT | 18% |
| Dividends (WHT) | 15% |
| Interest (WHT) | 10% |
| Royalties (WHT) | 14% |
| Social security (employee) | 8% |
| Social security (employer) | 15% |
| Wealth tax | None |
| Inheritance / estate | None. Estate duty has been abolished. |
| Property tax | Local-authority rates on the annual value of property. |
| Other | Social Security Contribution Levy (SSCL) of 2.5% on turnover. EPF at 8%+12% and ETF at 3%. Some sectors face corporate tax of 40%–45%. |
How the system works
- Tax system
- Worldwide (residence-based)
- Foreign income
- Taxed (worldwide)
- Taxes by citizenship
- No
- Exit tax
- No
- CFC rules
- No
- CRS
- Participating
Rates checked July 2026: the top marginal income tax rate, the standard VAT rate and the main corporate rate.