TIN deadline extended to April 1 amidst confusion
Even though the government has made it mandatory to register with the Inland Revenue Department and obtain a tax payer information number for all individuals who are 18 years of age or more, it does not mean that all of them have to pay tax.
This was stated by State Finance Minister Ranjith Siyambalapitiya when he clarified the implementation of TIN following the mounting public pressure against it.
Meanwhile the Finance Ministry has extended the deadline for the registration of TIN to April 1, 2024 from the earlier date of February 1.
The government has issued a gazette notification No 2334/21 dated May 31, 2023 in accordance with Section 102 of the Inland Revenue Act making the mandatory order relating to the registration with the IRD and obtain a TIN (Taxpayer Identification Number)”.
Accordingly, the Gazette Notification has been issued prescribing 14 categories of persons who should register with the IRD and obtain a TIN.
These classes of persons listed included doctors, architects, bankers, lawyers of the Supreme Court, accountants, engineers, quantity surveyors and persons with registered vehicles (except threewheelers, motorbikes, and hand tractors)
The other categories are persons who registered their businesses in Divisional Secretariats, the persons who have vehicles registered (other than three wheelers, motor bicycles and hand tractors) with the Department of Motor Traffic, persons who have purchased or acquired by virtue of deeds transfer of any immovable property in Sri Lanka on or after April 1, 2018.
Employees whose monthly contribution from both employee and employer to any Provident Fund is more than Rs. 20,000, any individual who obtains approval for a building plan from a local authority, and any other individual who receives payment of Rs. 100,000 per month or Rs.1.2 million per annum will have to obtain a TIN.
However the regulation of making it mandatory for all persons of over 18 years of age to obtain a TIN and registration with the IRD for a tax file has been challenged by several tax experts who claimed that section 102 of the IRD Act has not given any powers to the finance minister or the commissioner general to issue such order.
According to section 102 (4) of this act, the CommissionerGeneral shall register any person whom the CommissionerGeneral considers to have fulfilled the requirements for registration and assign the person a Taxpayer Identification Number (TIN).
N.M.M. Mifly, former Deputy Commissioner General of IRD Tax Policy, Legislation, Rulings and International Affairs, noted that anyone can challenge in courts the order of making compulsory for every one of over 18 years of age to obtain IRD registration and obtain TIN, as it is against the IRD Act..
Clarifying this issue which has now become debatable as everyone is worried about it, State Minister Siyambalapitiya pointed out that obtaining TIN will open easy access for individuals to get many services offered by several state institutions without any hindrance.
Possessing a TIN does not mean that every person of over 18 years is liable for paying tax, he said adding that it will be beneficial for all as the government is digitalising key public services to integrate it under a single platform.