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As enacted
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Contents

Part I

65. Petroleum operations

Official English translation. The Sinhala text prevails. Open the official Sinhala text, official PDF on documents.gov.lk

(1)

Any individual or entity who or which has entered into an agreement as a contractor or sub-contractor under the Petroleum Resources Act, No. 26 of 2003 shall be deemed to be resident in Sri Lanka over the term of such contract or sub contract, as the case may be, for the purposes of this Act.

(2)

The turnover from exports and local sales of petroleum exploited under any Petroleum Resources Agreement referred to in subsection (1), shall be determined on the basis of accepted commercial practices and be subject to any specific provisions in the Petroleum Resources Agreements, entered into under the Petroleum Resources Act, No. 26 of 2003.

(3)

The income, gains and profits from the business of petroleum exploitation under any Petroleum Resources

Agreement referred to in subsection (1), shall be ascertained after allowing the following deductions in addition to other allowable deductions under the provisions of this Act, and shall notwithstanding anything to the contrary in any other provision of this Act, be chargeable with income tax at the appropriate rate set out in the First Schedule to this Act, provided that the same item of expenditure shall not be deducted more than once:-

(a)

payments made to service sub-contractors for conducting petroleum operations;

(b)

one hundred percent of the cost of acquisition of any plant, machinery or equipment used for the recovery of petroleum resources, instead of the capital allowances under section 16. Any proceeds realised on the sale of such assets shall be considered as a receipt from such business;

(c)

interest expenses;

(d)

royalty paid on petroleum resources recovered under any Petroleum Resources Agreement;

(e)

all expenses on the development and production of petroleum, including capital expenses, where a deduction under paragraph (b) above has not been granted;

(f)

in the year of first commercial production, all costs incurred by any contractor in the exploration for unsuccessful wells in exploration blocks under any

Petroleum Resources Agreement, up to and including such year of first commercial production;

(g)

any costs incurred by any contractor in the exploration for unsuccessful wells in exploration blocks under any Petroleum Resources Agreement in any year of assessment, after the first commercial production.

Division II:Financial Institutions and Insurance Entities

Read on from s 66

Part II

Read on from Part II

Schedules