FTZMA urges tax credit for reinvested dividends in Budget 2027
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The Free Trade Zone Manufacturers' Association (FTZMA) has urged the government to offer non-resident shareholders a tax credit equal to the 15% dividend tax if they reinvest profits in Sri Lanka, as part of its Budget 2027 proposals.
The credit would apply to retaining profits, reinvesting declared dividends as equity in the same business, or investing in other Sri Lankan ventures. The FTZMA cited a four-month current account deficit, with a $387 million shortfall in the first seven months of the year, and said external shocks swung the balance by nearly $1.7 billion in six months.
The association stressed that debt repayments are fixed by contract while earnings are not, and called for prioritizing Free Trade Zone development, including expressway access and water supply for rural Export Processing Zones, urging against replicating existing zone blueprints.
