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Sri Lanka gives sweeping tax breaks to India’s ITC hotel

July 8, 2012 (LBO) - A mixed property project including a hotel in Sri Lanka's capital Colombo by India's ITC has been given sweeping tax breaks under the island's strategic investment law, a government notice said.
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Welcome Hotels Lanka (Pvt) Ltd, a newly incorporated ITC unit in Sri Lanka has already paid 73.
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5 million US dollars for a 99 lease of a 5 acre block state land near Colombo's main beachfront.
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The firm is expected to invest 140 million US dollars over 60 months in a mixed development, a state gazette notification said.

The firm has been given a 10 year tax holiday starting from the first year of profits or three years after operations.
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The firm will also get tax concession of 6 percent or half the rate of tax for hotels (whichever is lower)within the next fifteen years.

Up to 20 expatriate staff will be exempted from Pay As You Earn tax for five years .

Interest on foreign loans taken for capital expenses, technical fees to consultants management fees up to 3 percent of revenues, royalty and marketing fees up to 1.
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5 percent of revenue will be exempt from withholding tax.

Incentive management fees up to 10 percent of gross profit will also be exempted withholding tax. Charg

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