South Asian nations implement new tax regulations

In the Maldives, Member of Parliament Hussain Ziyad has raised concerns regarding a proposed amendment to the Income Tax Act. The bill seeks to increase the withholding tax on non-resident contractors from 5 per cent to 10 per cent. Ziyad argued that legislation alone cannot prevent corruption without proper accountability and warned that insufficient consultation could lead to unintended consequences for local businesses, particularly in the tourism sector.

In Sri Lanka, the Inland Revenue Department has announced new assessment rules for exported services. Starting from the 2025/26 year of assessment, income generated by Sri Lankan residents from providing services to overseas clients will be subject to a maximum tax rate of 15 per cent. This rate is intended to provide a separate treatment for professionals and freelancers working via digital platforms, exempting them from the ordinary progressive income tax structure which can reach rates as high as 36 per cent.