7. Insertion of new sections 16A, 16B and 16C in the principal enactment

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

The following new sections are inserted immediately after section 16 of the principal enactment and shall have effect as section 16A, section 16B and section 16C respectively, of that enactment:—

16A . (1) The profits and income within the meaning of paragraph (a) of section 3, other than any profits and income from the disposal of any capital asset, of any person or partnership from any undertaking for fishing carried on in

Sri Lanka, shall be exempted from income tax for each year of assessment within the period of five years commencing on April 1, 2011.

(2)

In this section "undertaking for fishing''

includes any undertaking for the cleaning, sizing, sorting, grading, chilling, dehydrating, packaging, cutting or canning of fish in preparation of such produce for the market.

(3)

In relation to an undertaking which consists of fishing and utilizing such fish for manufacturing of any product, such fish shall be deemed to have been sold for the manufacture of such product at the open market price prevailing at the time of such deemed sale, and the exemption granted under subsection (1) shall be applicable to that undertaking, on the profits and income computed on the basis of such deemed sale.

16B. (1) The profits and income within the meaning of paragraph (a) of section 3, other than any profits and income from the disposal of any capital asset, of any person or partnership from any undertaking for producing of agricultural seeds or planting materials, or primary processing of such seeds or materials, shall be exempted from income tax for each year of assessment within the period of five years, commencing on April 1, 2011.

Exemption from income tax of the profits and income of any under-taking for producing agricultural seeds or planting materials.

Exemption from income tax of the profits and income of any new undertaking investing not less than fifty million rupees.

(2)

In this section "primary processing'' means cleaning, sizing, sorting, grading, chilling, dehydrating, cutting, canning or packaging for the purpose of preparation of such produce for the market.

(3)

In relation to an undertaking which consists of producing of agricultural seeds or planting materials and utilizing such seeds or materials in the agriculture or horticulture, such produce shall be deemed to have been sold for such purpose at the open market price prevailing at the time of such deemed sale, and the exemption granted under subsection (1) shall be applicable to that undertaking, on the profits and income computed on the basis of such deemed sale.

16C. (1) The profits and income within the meaning of paragraph (a) of section 3 (other than any profits and income from the sale of any capital asset) of any new undertaking referred to in subsection (2), and carried on by any person or partnership on or after April 1,

2011, shall be exempted from income tax for a period of three years reckoned from the commencement of the year of assessment in which such undertaking commences to make profits from transactions entered into in that year of assessment, or from the commencement of the year of assessment immediately succeeding the year of assessment in which the undertaking completes a period of two years reckoned from the date on which the undertaking commences to carry on commercial operations, whichever occurs earlier.

(2)

For the purpose of subsection (1), "new undertaking'' means an undertaking-

(a)

which is engaged in the manufacture of any article other than any liquor or tobacco product;

"Exemption from income tax of the profits and income from any new undertaking engaged in any pre-scribed activities.

(b)

in which the sum invested in the acquisition of fixed assets after

November 22, 2010 but before March 31, 2012 is not less than fifty million rupees; and

(c)

which commences commercial operations on or after April 1, 2011.''.

Read on from s 8