Construction expenses in Sri Lanka rise by 20% after VAT hike

Building construction site

After the increase in VAT from January 01, 2024, the overall construction expenses have increased by 20%, Chairman of the  National Construction Association of Sri Lanka M.D. Paul said.

He said that the construction sector is facing a severe crisis due to the inclusion of fuel in the list of goods subject to VAT.

He added that many items such as machinery, electricity, and light bulbs, which were previously on the exempt list, are now applicable for VAT, and that due to this, construction expenses have shot up by 20%.