What is the SSCL?

The Social Security Contribution Levy (SSCL) is a tax introduced by Sri Lanka in 2022 under Act No. 25 of 2022. It applies a levy on businesses that exceed certain turnover thresholds, requiring them to register and remit the levy to the government. The funds contribute to social security programmes.

The SSCL is separate from VAT and customs duties. Businesses in the supply chain — including vehicle importers and dealers — are affected when their turnover crosses the threshold set by law.

The biggest change: motor vehicles now subject to SSCL

Previously, item 25 of Part Ia of the First Schedule to the SSCL Act provided an exemption for motor vehicles on importation with no end date. The Amendment Act has now placed a deadline on that exemption.

In plain terms: any motor vehicle imported into Sri Lanka on or after May 1, 2026 is no longer covered by the Part Ia exemption and may attract SSCL at the point of import.

A new exemption added — Part Ib, Item 7

Alongside removing the old open-ended exemption, the Amendment also adds motor vehicles into Part Ib of the First Schedule. Part Ib lists goods whose local supply is exempt from SSCL. The new item reads:

This means the local sale or supply of motor vehicles — for example, by a registered dealer within Sri Lanka — retains an SSCL exemption from May 1, 2026 onward. The key distinction is:

• Importation of motor vehicles: SSCL exemption removed from May 1, 2026
• Local supply of motor vehicles: SSCL exempt from May 1, 2026 (new Part Ib item)

Registration threshold changes (July 1, 2026)

The Amendment also revises when businesses must register for SSCL, by updating Section 4 and Section 5 of the principal Act. These changes take effect from July 1, 2026 and introduce a lower threshold compared to the previous rules.

The lowering of the annual threshold from Rs. 60 million to Rs. 36 million will bring more businesses within the SSCL registration net. Vehicle dealers and importers with moderate volumes should check whether they now qualify for mandatory registration.

Timeline of key dates

What this means for Japanese car buyers in Sri Lanka

If you are buying a Japanese vehicle through an importer or dealer in Sri Lanka, here is how these changes may affect you:

• Vehicles imported from May 1, 2026 onward may carry additional SSCL costs at the import stage, which importers could pass on in the vehicle price.
• Vehicles already in Sri Lanka and sold locally by dealers are covered by the new Part Ib exemption — the local supply transaction itself remains SSCL-free.
• More dealers may register for SSCL from July 2026, as the threshold drops from Rs. 60M to Rs. 36M annually. This could affect how businesses invoice and price vehicles.
• If you are a small importer or dealer, check whether your 4-quarter rolling turnover now crosses Rs. 36M — you may need to register within 15 days of doing so.

Frequently asked questions

Disclaimer: This article is for informational purposes only and is based on the Social Security Contribution Levy (Amendment) Act No. 10 of 2026 as certified on April 9, 2026. It does not constitute legal or tax advice. Consult a qualified Sri Lankan tax professional for guidance specific to your situation.