Ceylon Institute of Builders (CIOB) is requesting the government to instruct the Inland Revenue Department (IRD) to halt charging contractors until necessary directives have been enforced.
President, CIOB Dr. Rohan Karunaratne (PICTURED) says that the previous government initiated the Social Security Contribution Levy (SSCL) tax, in 2022.
“Although it clearly states that all contracts signed after October 1, 2022 are liable for SSCL which the client has to pay in addition to the 18% tax. It is very unfortunate that many clients have refused to pay this additional 2.5% to contractors.”
“Many contractors admit that none of their clients have paid this, which leaves them unable to pay this levy to the government. Due to competitive tendering, near-zero margins, compounding losses etc. contractors cannot pay SSCL personally.”
“However, the IRD levies SSCL from the total VAT amount, in addition to all other taxes, add penalties and threaten contractors with legal action.”
Some projects such as funded projects, infrastructure projects etc. are exempted from SSCL, yet these thresholds are often ignored and SSCL is imposed on all.
“In this regard, the Secretary of the Ministry of Urban Development, Construction, and Housing has verbally committed to aligning actions with these requests during a recent meeting with the construction industry.”
“Similarly, during a meeting held between the Ministry of Finance and the Ceylon Institute of Builders (CIOB) on January 16, 2025, assurances were provided to fulfill these proposals.”
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