Sri Lanka: Strategic Development Projects (Amendment) Act, No. 26 of 2025
Effective December 17, 2025
The Strategic Development Projects (Amendment) Act, No. 26 of 2025 includes the following changes to the tax incentive scheme for strategic development projects (SDP)—effective December 17, 2025:
- Maximum tax holiday reduced from 25 to 10 years
- Transitional provision
- Revised identification procedure for SDP
- Ex-post monitoring of the SDPs and sanctions for non-compliance
- Procedure to be followed prior to imposing sanctions
- Mandatory tax compliance
- Issuance of the expenditure statement and review mechanism
- Power to make regulations by the Minister
Read a January 2026 report prepared by the KPMG member firm in Sri Lanka