BY SANDHYA DISSANAYAKE, ATTORNEY-AT-LAW
The Court of Appeal on Thursday (21) postponed its decision on the writ petition filed by former Sri Lanka ODI captain Charith Asalanka and current Test captain Dhananjaya de Silva regarding the imposition of withholding tax on national cricketers.
The petition was filed against the Inland Revenue Department’s (IRD) decision to classify Sri Lankan national cricketers contracted to Sri Lanka Cricket (SLC) as employees, making them liable for withholding tax deductions.
Alongside the two national captains, several other current Sri Lankan cricketers have also joined the legal challenge, arguing that the classification is arbitrary and legally flawed.
The matter was scheduled for final determination before a two-judge bench consisting of Court of Appeal President Justice Rohantha Abeysuriya and Justice Priyantha Fernando. However, the bench announced that the ruling had not yet been finalised and would therefore be delivered at a later date.
The petitioners argued that the interpretation made under the Inland Revenue (Amendment) Act No. 45 of 2022 incorrectly categorised national cricketers as employees of Sri Lanka Cricket.
Lawyers representing the players pointed out that cricketers do not receive employee-related benefits such as Employees Provident Fund (EPF) contributions or standard employment allowances, making the classification legally questionable.
Counsel appearing for Sri Lanka Cricket also informed court that national cricketers should be considered independent service providers rather than employees under traditional labour definitions.
It was explained during proceedings that the Inland Revenue Department had decided to apply withholding tax on contracted national players from January 1, 2023, based on provisions introduced through the amended Inland Revenue Act.
The case has attracted significant attention within Sri Lankan cricket circles, as the final ruling could have major financial and legal implications for national players and future contract structures within Sri Lanka Cricket.
The postponement means uncertainty continues for players currently affected by the taxation policy, while both legal and cricket authorities await the Court of Appeal’s final interpretation on the matter.
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