No changes in the PAYE tax rate for medical professionals – Finance Minister

No changes in the tax rate for the calculation of Income Tax or the PAYE (pay as you earn) tax, has been made to the members of the Association of Medical Specialists, Minister of Finance and Mass Media Mangala Samaraweera said.

He was responding to the media reports which quoting Minister of Health Dr. Rajitha Senaratne said that following a meeting held with Finance Minister Mangala Samaraweera PAYE tax has been reduced to 15 percent.

Minister of Finance Samaraweera said that an agreement was reached to amend the process of the expenditure calculation for the purpose of income tax payment only.

Health Minister Rajitha Senaratne has reportedly stated that the 24 percent income tax imposed on medical specialists would be reduced to 15 percent.

State Minister of National Policy and economic Affairs Dr. Harsha de Silva expressed outrage on the reported reduction of PAYE tax for only a group of professionals.

“Dr Rajitha says PAYE for specialist doctors in Sri Lanka capped at 15%. I am shocked! What about other doctors, pilots, lawyers? We had made some revisions in discussing expanding slabs so ALL hard working MIDDLE CLASS would BENEFIT; w progressive principle of taxation,” the State Minister said in a Twitter post.

The Association of Medical Specialists (AMS) said that they had decided to withdraw from private practice from last week against unfair taxation on medical professionals.

The Finance Ministry introduced PAYE tax scheme under its new Inland Revenue Act which came into effect from April 1, 2018 to tax the income earned by professionals through private practice.

The Finance Ministry has reiterated that only the income earned through private practice will be subjected to the PAYE tax and the state service income will not be taxed at 24 percent. The state sector income of doctors will be subject to a ceiling of 12 percent.

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