Social Security Contribution Levy (Amendment) Bill – Key Highlights and Practical Impact

Issued on 01 October 2025
(Subject to Parliamentary approval and certification by the Speaker)

A new Bill to amend the Social Security Contribution Levy (SSCL) Act, No. 25 of 2022 was issued on 01 October 2025.
This Bill proposes several important changes to existing SSCL provisions, introducing new exemptions, restrictions, and clarifications that will take effect in 2025 and 2026.
The Bill will become law only after Parliamentary approval and certification by the Speaker.

1. New Exemption – Financial Services

What the Bill Says:
Financial services provided by any person or institution carrying on the business of providing financial services in Sri Lanka will be exempt from SSCL.

• Effective Date: 01 January 2026

Impact:

• This provides a significant tax relief to banks, finance companies, leasing entities, and other financial service providers since now financial services will be subject to only VAT On FS.

2. Restriction on Exemption – Electricity Sector

What the Bill Says:
The current exemption on import or local purchase of machinery or equipment for electricity generation (by the Ceylon Electricity Board or institutions supplying electricity to the CEB) will be withdrawn.

• Any supply made after 18 February 2025 will be liable to SSCL.

• Effective Date: 18 February 2025

Impact:

• Electricity generation projects will no longer enjoy SSCL exemption on machinery and equipment.

3. Clarification of Exemptions

a. Petrol, Diesel, and Kerosene

What the Bill Says:

• Up to 30 June 2025, exemption applies to sales made at filling stations.

• From 01 July 2025 onwards, the exemption applies to all sales of petrol, diesel, or kerosene.

Impact:

• Brings uniformity and clarity to the fuel supply chain.

b. Transportation of Goods and Passengers

What the Bill Says:

• Up to 31 December 2025, exemption applies to transportation of goods and passengers.

• From 01 January 2026 onwards, the exemption extends to include services related to international transportation by container terminal operators.

Impact:

• Offers tax relief for logistics, shipping, and port operators involved in international cargo handling.

Important Note

This is a Bill, not yet law. All provisions described above will take effect only after the Bill is passed by Parliament and certified by the Speaker.

Summary

The proposed SSCL amendments reflect the Government’s effort to streamline exemptions and align tax policy with key economic priorities. While the financial sector stands to gain significant relief, the electricity generation sector may face higher costs due to the withdrawal of existing exemptions. Meanwhile, the clarifications on fuel and transport exemptions aim to reduce ambiguity and support smoother compliance.

Read The Bill : Social Security Contribution Levy (Amendment) - GS