SHANGRI-LA has secured several tax concessions from the Sri Lankan government to build a multi-purpose leisure complex and resorts in the country.
The Asian hotel chain is planning two developments, in Colombo and the southern city of Hambantota. It has set up two subsidiary companies to handle the projects.
According to a gazette notification issued by Economic Development Minister Basil Rajapaksa, who handles the tourism portfolio, Shangri-La Hotels Lanka is building an “upmarket hotel, high-quality residencies and a high-end shopping mall” on four hectares of land in Colombo, near Sri Lanka’s army headquarters.
This project will enjoy a 10-year corporate tax holiday, a 10-year exemption on dividend income and a five-year exemption on income tax for a maximum of 20 expatriate staff, among others.
The Colombo project involves an estimated investment of US$283 million.
The notification issued by the minister, under provisions available for tax concessions in strategic development projects, provides similar concessions to Shangri-La Investments Lanka, which is building a luxury hotel and residential villas in Hambantota, totalling an estimated US$109 million.
This company has already spent around US$3.5 million to purchase the land there.
The tax breaks, according to the minister, who is the younger brother of President Mahinda Rajapaksa, have been provided, as “the projects are of national interest and likely to (bring) economic and social benefits to the country, and also change the landscape of the country”.
PATA chairman Hiran Cooray, who is also chairman of Sri Lankan Jetwing Hotels, welcomed the special concessions for Shangri-La, saying such high-class hotels would elevate the hotel industry there.
“I have stayed in Shangri-La hotels overseas, and the service is fantastic. We can learn from them,” he said.
