Sri Lanka to criminalize tax violations under new IRD amendments

Sri Lanka is set to introduce new amendments to the Inland Revenue Act on May 19, 2026 making several tax-related violations criminal offences punishable by fines of up to Rs. 400,000 and prison terms of up to six months.

The proposed amendments are scheduled to be presented to the Parliament of Sri Lanka tomorrow as part of efforts to strengthen tax administration and increase government revenue.

Under the new amendments, failing to obtain a Taxpayer Identification Number (TIN) which is mandatory for every citizen above the age of 18, will be treated as a criminal offence. Authorities also plan to criminalize the failure to properly submit tax files and reports to the Inland Revenue Department (IRD) as well as failing to appear before the Commissioner General of IRD when required.

According to the IRD, the main objective of the programme is to increase the number of taxpayers in the country and help achieve a tax revenue target equal to 20 percent of the country’s Gross Domestic Product (GDP).

Officials further stated that individuals found guilty under the proposed offences could face fines of up to Rs. 400,000, imprisonment for up to six months or both.

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