This may be zero rates depending on the nature:
Sec 7. (1) B) (iv) A supply of services shall be zero rated where the supply of such services are directly connected with the international transportation (including trans-shipment) of goods or passengers as are specified by the Commissioner-General by Notification published in the Gazette;
Sec 83. Interpretation
“International transportation” means any service directly related to the transportation of goods or passengers –
(a) from a place in Sri Lanka to a place outside Sri Lanka;
(b) from a place outside Sri Lanka to a place in Sri Lanka up to the point of landing unless such services are carried out under a specified carriage contract according to the Documents of carriage issued by a freight forwarder who is registered with the Central Bank of Sri Lanka
Notes
• This excludes landing, delivery and other services in relation to imports. That means they are not zero-rated.
• Exports:- Freight forwarding from a factory in Sri Lanka to a destination abroad will be zero-rated. Services obtained from others are not zero-rated.
• Zero rating is available only to the international transporter who in fact undertakes to transport goods/passengers. Thus the charterer of a ship or aircraft for international transportation of goods or passengers will qualify for zero rating but not the owner of the ship or aircraft who hired it or supplied it to the charterer.
• Any other services including coastal and inland transportation services for a local customers will be liable to VAT.
• Outbound travel being international transportation of passengers is zero-rated. But it is not applicable for commission received by the local agent.
Relevant gazettes issued–No.1201/9 of 11.09.2001 and 1246/21 of 26.07.2002
You need to check these Gazettes to see whether your service come under zero rated services.
