26. Replacement of section 102 of the principal enactment

Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.

Section 102 of the principal enactment is hereby repealed and the following section is substituted therefore:—

102. (1) Where any non governmental organization as defined in subsection (2) of this section, receives in any year of assessment any money in the form of a grant, donation, contribution or in any other form, an amount equal to three per centum of the aggregate of such money after deducting from such

“Deemed profits and income of any non-governmental organization to be chargeable with income tax.

aggregate any part of such money as is received from the Government of Sri Lanka, shall, notwithstanding anything to the contrary in any other provision of this Act, be deemed to be the profits and income attributable to the aggregate of such money (hereinafter in this section referred to as “deemed profits and income”) of such non-governmental organization for that year of assessment, and such deemed profits and income of such non governmental organization for such year of assessment, shall be deemed to have arisen in Sri Lanka.

(2)

For the purposes of subsection (1) a “non-governmental organization” means any organization or association, whether corporate or unincorporate, formed by a person or a group of persons on a voluntary basis and which is non governmental in nature, dependent on money received in the manner referred to in subsection (1) and established and constituted for the provision or relief and services of a humanitarian nature to the poor and destitute, the sick, orphans, widows, youth, children or generally for the provision of relief to the needy, unless such organization or association is determined by the Commissioner-General not to be a non-governmental organization for the purposes of this section, but does not include any approved charity within the meaning of paragraph (a) of subsection (8) of section 34, in respect of which any remission or reduction has been granted under subsection (3) of section 35.

(3)

The deemed profits and income of a non-governmental organization shall, subject to the provisions of paragraph (e) of section 7, be chargeable with income tax at the appropriate rate specified in the Fifth Schedule to this Act :

Provided that where the Commissioner-General is satisfied that any non-governmental organization is engaged, in any year of assessment, in :—

(a)

rehabilitation and the provision of infrastructure facilities and livelihood support to displaced persons in any area identified by the Government for the purposes of such rehabilitation and provision; or

(b)

any other activity approved by the

Minister as being of humanitarian in nature, taking into consideration the nature and gravity of any disaster and the magnitude of relief required to be provided consequently, the Commissioner-General may reduce or remit the tax payable by such non-governmental organization for that year of assessment, if it appears to him that such reduction is just and equitable in all the circumstances of the case.”.

Read on from s 27