As enacted

Contents

49. Insertion of new Chapter XVIB 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 Chapter is hereby inserted immediately after Chapter XVIA of the principal enactment, and shall have effect as Chapter XVIB of that enactment :–

‘CHAPTER XVIB

DEDUCTION OF INCOME TAX FROM, REWARD

PAYMENTS MADE BY ANY GOVERNMENT

INSTITUTION TO INFORMANTS AND OTHERS AND

SHARES OF FINES PAID TO ANY PERSON AND

LOTTERY PRIZES, WINNINGS FROM GAMBLING OR

WINNINGS FROM BETTING, PAID BY ANY PERSON

OR PARTNERSHIP.

132A. Where, on or after April 1, 2003 —

(a)

any Government institution pays a reward or distributes a share of fine to any person ;

(b)

any person or partnership pays a lottery prize, winnings from gambling or winnings from betting to any person, such institution, person or partnership, as the case may be, shall deduct at the time of the payment of such reward, share of fine, a lottery prize, winning from gambling or winning from betting as the case may be, income tax at the rate of ten per centum on such gross payment :

Provided, however, in case of any payment referred to in paragraph (b), the tax shall be deducted only where such payment is not less than rupees five hundred thousand :

Provided further, where any person or partnership pays a lottery prize, winnings from gambling or winnings from betting, other than in cash, such person shall be liable to, pay the relevant amount of income tax on such lottery prize winnings from gambling or winnings from betting to the Commissioner-General.

Government institution paying rewards or fines or other person or partnership paying lottery prizes ect. to deduct income tax.

132B. (1) The provisions of Chapter XV relating to the deduction of income tax from interest paid by banks and financial institutions, duties of banks and financial institutions, default in the deduction of income tax, issue of assessments of banks and financial institutions, appeals and penalty for default, shall, mutatis mutandis, apply to the deduction of income tax from such payments of rewards, share of fines, lottery prizes, winnings from gambling or winnings from betting as is mentioned in section 132A, duties of persons or partnerships making such reward payments, share of fine, lottery prize, winnings from gambling or winnings form betting, default in the deduction of income tax, issue of assessments on such persons and partnerships, appeals and penalty for default under this Chapter as if there were substituted in Chapter XV for the words “banks and financial institutions” of the words “any person or partnership paying any reward, share of fine, a lottery prize, winnings from gambling or winnings from betting” and for the word

“interest” of the words “any reward, share of fine, lottery prize, winnings from gambling or winnings from betting” where ever they appear in that Chapter,

(2)

(a) The aggregate amount of—

(i)

rewards paid to any person during any calendar month shall be deemed to be one reward payment and the income tax on such payment shall be deducted on the last working day of each month ;

(ii)

shares of fines paid to any person during any calendar month shall be deemed to be one share of fine payment and the income tax on such payment shall be deducted on the last working day of each month ;

Provisions of

Chapter XV to apply in relation to the deduction under this

Chapter.

(iii)

winnings from gambling paid or winnings from betting paid per day to any person shall be deemed to be one payment of winnings from gambling or winnings from betting and the income tax on such payment shall be deducted during the course of that day ;

(b)

in the case of lottery prizes each such prize whether paid in cash or otherwise shall be considered as a seperate prize.

(3)

For the purposes of this Chapter—

“reward” means any gift made or reward paid by the Government under any scheme for the payment of rewards to the informants and others ;

“share of fine” means any share of fine collected and distributed or paid by the

Government in accordance with any scheme for the payment of fines ;

“lottery prize” means any prize either in money or otherwise offered and won in any lottery conducted by any person in

Sri Lanka ;

“winnings from gambling” means any payment received for winning in any gambling or gaming activity from any party including a casino ;

“winnings from betting” means any payment received for winning in any on-course or off-course betting.

(4)

Notwithstanding the provisions of section 125 the total amount of the tax decucted—

(a)

from lottery prizes shall be remitted, to the Commissioner – General on the first day of the week and where such first day of the week is not a working day on the following working day, which amount shall be the total tax deducted during the week ending on the Sunday immediately preceding the date of such remittance;

(b)

from the winnings from gambling or winnings from betting shall be remitted to the Commissioner-General, on the first day of the week and where such first day of the week is not a working day on the following working day, and the amount to be remitted shall be the total tax deducted during the week ending on the

Sunday immediately preceding the date of such remittance.’.

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