🇱🇰 Budget 2026: Tax Parity for Fabric Imports

• A key tax proposal aims to ensure a "level playing field" between locally manufactured and imported fabric, impacting the vital apparel & textiles sector. • Current State: Local fabric is subject to VAT. Imported fabric is VAT-exempt but incurs a CESS of Rs. 100/kg. • Proposed Change: • The CESS on imported fabric will be removed. • VAT will be imposed on imported fabric. • Goal: To align the tax treatment of both imported and local fabric. • Effective Date: This measure will be implemented from April 01, 2026.