By: Staff Writer

June 15, Colombo (LNW): After years of uncertainty and repeated delays, Sri Lanka’s long-stalled Bandaranaike International Airport Terminal 2 project appears to be moving toward a long-awaited restart, with construction expected to resume during mid-2026.

The massive expansion project, considered one of the country’s most significant aviation infrastructure developments, has remained largely dormant since late 2022 when funding complications brought construction activities to a standstill.

At the heart of the disruption was the suspension of financial assistance from the Japan International Cooperation Agency (JICA). The agency halted its concessionary loan programme after Sri Lanka defaulted on its sovereign debt obligations, effectively freezing progress on the project when only six percent of construction had been completed.

Government officials now say the situation has changed dramatically following the country’s debt restructuring process. JICA has reportedly agreed to reactivate funding support, providing a crucial lifeline for the airport expansion initiative.

According to the Ministry of Ports and Civil Aviation, technical evaluations of Japanese contractors bidding for the critical Package A1 contract have already been completed. This package covers some of the most important components of the development, including the main terminal building, Piers 2 and 3, and elevated roadway infrastructure.

The ministry has forwarded its evaluation recommendations to JICA for final review and approval. Once concurrence is granted, authorities expect financial bids to be opened and the contract awarded to the successful bidder without significant delay.

Officials anticipate that construction mobilisation could begin between June and July 2026, marking the formal restart of physical work at the site.

Under current contractual conditions, the selected contractor will be required to complete the project within a legally binding period of 30 months. If timelines are maintained, Terminal 2 could begin operations by late 2028 or early 2029.

However, significant financial challenges remain despite the project’s revival. Since the original agreement was signed several years ago, global inflation and rising construction material costs have substantially increased the overall project budget.

As a result, the original JICA financing package is no longer sufficient to complete the development. Government negotiators are currently engaged in discussions with both JICA and Japanese authorities to secure additional funding estimated at between US$450 million and US$564 million.

Industry observers note that Terminal 2 is expected to transform Sri Lanka’s aviation capacity by significantly increasing passenger throughput and modernizing airport services. The facility is also regarded as essential to supporting future tourism growth and strengthening Colombo’s competitiveness within the regional aviation market.

While several procedural and financial hurdles remain, the project’s return to active implementation represents the strongest indication yet that one of Sri Lanka’s most delayed infrastructure ventures may finally be back on track.

By: Staff Writer

June 15, Colombo (LNW): A sweeping overhaul of Sri Lanka’s import taxation system is set to reshape multiple industries in 2026, with edible oils emerging as one of the most closely watched sectors. While the latest Gazette notification has generated confusion among traders and consumers, tax experts say the current position remains unchanged for now.

The Gazette does not introduce the government’s proposed 18 percent Value Added Tax on palm oil imports. Instead, it simply renews the Special Commodity Levy (SCL), preserving the existing tax arrangement that has governed imports of certain commodities for years.

The distinction is crucial. Under the SCL framework, products listed in the Gazette are subject to a single levy calculated at a fixed rate. Because the levy is treated as a composite tax, importers are exempt from paying standard VAT, Customs Duty, and CESS at the point of importation. This mechanism has long been used to simplify tax collection while controlling the cost of selected goods.

For the palm oil industry, the continuation of the SCL means that current import practices remain largely unchanged. Importers clearing shipments under relevant HS classifications must continue paying the specified rupee-per-kilogram levy outlined in the Gazette schedule.

The bigger story, however, lies beyond the current extension.

The Ministry of Finance has already outlined plans to dismantle the SCL structure for edible oils from April 1, 2026. Once implemented, imported palm oil and coconut oil will move into the broader national tax system, where taxes are calculated on customs values rather than fixed commodity rates.

The consequences could extend beyond the edible oil trade. Importers across related sectors are closely monitoring the transition because it signals a broader policy direction toward integrating products into the standard tax framework.

Businesses fear that the shift could increase landed costs, particularly when combined with VAT, Customs Duty, CESS, and Social Security Contribution Levy obligations. Unlike the fixed SCL model, the new structure introduces multiple tax layers and potentially greater compliance requirements.

Local manufacturers, however, view the reforms differently. Industry representatives have long argued that imported edible oils benefit from preferential treatment compared with domestic producers who already pay VAT within the local market. By eliminating the SCL and applying uniform taxation rules, policymakers hope to reduce distortions and strengthen local industry competitiveness.

The debate now centers on whether higher import taxes will protect domestic producers or ultimately raise costs for consumers. Analysts note that any increase in import expenses could eventually be reflected in retail prices unless absorbed by importers or distributors.

Until April 2026, the SCL remains the governing tax mechanism for covered products. Yet the countdown to a fundamentally different import tax landscape has already begun. For importers, manufacturers, and consumers alike, the coming months will determine how effectively businesses adapt to a system that promises greater uniformity but also introduces new financial pressures across the supply chain.

By: Staff Writer

June 15, Colombo (LNW): Sri Lanka’s sweeping expansion of its Taxpayer Identification Number (TIN) system is rapidly transforming how citizens interact with banks, government institutions, and businesses. While authorities describe the initiative as a necessary modernization of tax administration, critics warn that millions of people remain outside the system and could face significant obstacles in conducting everyday transactions.

According to the Inland Revenue Department (IRD), more than 13 million TINs have already been issued. However, officials estimate that approximately four million additional individuals still need to register. Under current regulations, every Sri Lankan resident aged 18 and above is legally required to obtain a TIN, bringing the total eligible population to roughly 17 million people.

The urgency surrounding registration intensified following the enactment of the Inland Revenue (Amendment) Act No. 11 of 2026. The legislation links TIN certification to a broad range of financial and administrative activities that affect millions of citizens.

Under the new framework, individuals seeking to open bank accounts, obtain credit cards, register businesses, transfer company shares, register motor vehicles, or renew annual revenue licenses must first provide a valid TIN. Property-related transactions, including land registrations, ownership transfers, and approvals for building plans, are also increasingly tied to TIN verification requirements.

The law marks a major shift in government oversight by integrating a single taxpayer identifier into multiple sectors of economic activity. Revenue officials argue that the measure will strengthen tax compliance, improve transparency, and help reduce tax evasion.

Another significant change concerns data accessibility. Previously treated as confidential tax information, TIN details will no longer enjoy the same level of privacy under the amended legislation. This has raised concerns among privacy advocates who fear broader sharing of personal information across institutions.

The amendments also introduce stricter enforcement provisions. A dedicated chapter on the prosecution of tax-related offences empowers authorities to pursue legal action against individuals who fail to register within prescribed timelines or ignore official tax notices. Financial penalties and criminal proceedings may follow in cases of non-compliance.

Government officials maintain that these measures are essential to improving revenue collection and strengthening public finances. Yet questions remain about the readiness of the remaining unregistered population, many of whom may be unaware of their obligations or uncertain about the registration process.

As Sri Lanka accelerates implementation, the TIN is evolving from a tax administration tool into a mandatory gateway for numerous aspects of daily life. Whether the transition succeeds without creating widespread inconvenience will depend largely on how effectively authorities reach the millions still outside the system and address concerns over enforcement, accessibility, and privacy.

By: Staff Writer

June 15, Colombo (LNW): Sri Lanka has launched an urgent campaign to secure continued access to one of its most valuable trade concessions, as officials work against the clock to qualify for the European Union’s next Generalised Scheme of Preferences Plus (GSP+) cycle before March 2027.

The preferential trade arrangement, which grants tariff-free or reduced-tariff access to thousands of products entering the EU market, has become a cornerstone of Sri Lanka’s export economy. More than 80 percent of Sri Lankan goods exported to Europe currently benefit from the scheme, helping local manufacturers remain competitive in a demanding global marketplace.

The stakes are enormous. The European Union represents a market worth approximately €3.7 billion for Sri Lankan exports and generates a significant trade surplus for the island nation. With the existing GSP+ framework scheduled to expire on December 31, 2027, authorities are treating the renewal effort as an economic priority.

Sri Lanka Export Development Board (EDB) Chairman Mangala Wijesinghe has revealed that the government has received approval from the highest political levels to begin the formal reapplication process. According to him, officials are implementing a broad package of legislative, regulatory, and human rights reforms designed to satisfy the EU’s demanding eligibility criteria.

At the center of the effort is compliance with 27 international conventions covering human rights, labor protections, environmental safeguards, and governance standards. Government agencies are now reviewing domestic laws to ensure they align with international obligations.

Particular attention has focused on legislation that has attracted criticism from international observers. Authorities are reportedly preparing significant legal reforms, including amendments to the Online Safety Act, to address concerns surrounding freedom of expression and civic liberties. Additional measures are also being developed to meet obligations related to disability rights and the prevention of child involvement in armed conflict.

Behind the scenes, officials are seeking technical support from European authorities to strengthen Sri Lanka’s compliance monitoring systems. The government is looking to modernize certification procedures, improve factory inspections, and establish stronger mechanisms for tracking labor and environmental standards.

Industry stakeholders are also being drawn into the process. The EDB, in collaboration with the Joint Apparel Association Forum (JAAF), is conducting training programs aimed at helping exporters diversify into underutilized product categories that enjoy duty-free access under the scheme.

Officials are also building documentation and verification systems capable of providing tangible evidence that Sri Lankan industries meet EU requirements.

For many exporters, the renewal effort has become a matter of economic survival. The EU absorbs nearly one-quarter of Sri Lanka’s total exports, while an estimated €1.5 billion worth of goods depend heavily on GSP+ concessions to remain competitive against regional rivals.

As the countdown to 2027 continues, the success or failure of Sri Lanka’s reform agenda could determine the future of one of the country’s most important export markets.

June 15, Colombo (LNW): Sri Lanka officially commenced a year-long programme marking five decades of diplomatic relations with Qatar through a special Ceylon Tea showcase held at the renowned Katara Cultural Village in Doha, highlighting the enduring friendship between the two nations and the global legacy of Sri Lanka’s tea industry.

The event brought together diplomats, senior government representatives, business leaders and members of the media in a celebration that combined cultural exchange, economic heritage and international cooperation. The gathering also commemorated the 159th anniversary of the Ceylon Tea industry, one of Sri Lanka’s most recognised global brands and a key contributor to the country’s export economy.

The ceremony was attended by General Manager of Katara Cultural Village, Khalid Al Sulaiti, who served as the chief guest. Organisers noted that the choice of venue reflected the strong cultural connections that have developed between Sri Lanka and Qatar over the past half-century, providing an ideal setting for the launch of the Golden Jubilee commemorations.

Addressing the audience, Sri Lanka’s Ambassador to Qatar, Sithara Khan, reflected on the remarkable journey of Ceylon Tea since its introduction in the nineteenth century. She described the industry as more than an economic success story, emphasising its role in supporting communities, preserving traditions and promoting sustainable agricultural practices across generations.

The Ambassador noted that tea has long been associated with hospitality and human connection, making it a fitting symbol for the anniversary celebrations. She observed that, much like diplomacy itself, a shared cup of tea has the power to foster dialogue, strengthen relationships and bridge cultural differences.

Drawing parallels between international relations and Sri Lanka’s tea heritage, she highlighted the steady growth of cooperation between Colombo and Doha over the past 50 years, encompassing trade, investment, labour relations, tourism and cultural engagement. She said the partnership had been built on mutual respect and continued to evolve in ways that benefit both nations.

The event also recognised the contributions of the Qatar–Sri Lanka Business Council and Katara Cultural Village, whose collaboration helped bring the celebration to life.

One of the evening’s main attractions was an extensive tasting experience featuring Sri Lanka’s seven distinctive regional tea varieties. Guests were invited to sample a carefully curated collection of premium blends and specialty teas, offering a journey through the diverse flavours and characteristics that have made Ceylon Tea renowned worldwide.

Complementing the tea experience were a range of artisanal refreshments and culinary pairings, creating an immersive showcase of Sri Lankan hospitality and craftsmanship. Attendees also had the opportunity to learn about the history, production methods and regional uniqueness of the island’s tea-growing districts.

With approximately 150 guests in attendance, the event marked the first in a series of commemorative programmes scheduled to take place throughout 2026 and 2027. Organisers said the upcoming initiatives will further celebrate the longstanding partnership between Sri Lanka and Qatar while promoting deeper cooperation across cultural, economic and diplomatic spheres.