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The Tax Cluster will look at providing tax concessions for tsunami-donations and for reconstruction activity, says the Inland Revenue. "We have got requests for tax concessions on donations and for imports for reconstruction. We will discuss these when the Tax Cluster meets early next week and make a decision," said R P L Weerasinghe, Commissioner General, Inland Revenue.
In Sri Lanka tsunami relief is turning into a big business and already companies are looking at acquiring some extra merit during this life time in the form of tax reductions.
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The problem is that under the current Inland Revenue law, income tax cuts are available only if charitable donations are channelled through the government or an approved charity.
Under section 31(2)(b) of the Inland Revenue Act, any cash donations made by companies or individuals, to a government-specified institution or fund, is totally tax deductible.