The Court of Appeal has issued a writ order quashing the decision by the Commissioner General of Inland Revenue to treat Sri Lanka’s national cricketers as employees for the purpose of imposing Personal Income Tax, following petitions filed by several national players.
The ruling was delivered on Monday (31), after the Court had earlier sought clarification from the Inland Revenue Department (IRD) on whether recent amendments to the Inland Revenue Act affected its position in the case.
The dispute centred on the IRD’s decision to classify national cricketers as employees due to their contracts with Sri Lanka Cricket, a position challenged by the players.
During previous proceedings, counsel for the cricketers argued that players had for more than 15 years been treated as Independent Service Providers and that the IRD had arbitrarily reclassified them as employees in order to impose Advance Personal Income Tax (APIT).
The case also came amid a recent amendment to the Inland Revenue Act that expressly categorises “sports persons” as Independent Service Providers, who are not subject to APIT.
However, the IRD, represented by Deputy Solicitor General Manohara Jayasinghe, had maintained that the amendment did not apply to the petitioners and argued that national cricketers should be considered employees because of their contractual relationship with Sri Lanka Cricket.
The writ applications were heard before Court of Appeal President Justice Rohantha Abeysuriya, PC, and Justice K. Priyantha Fernando. (Newswire)
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