Taxpayers in Sri Lanka would need to contribute an additional Rs. 136,000 in taxes compared to 2020, with the government’s recent tax measures, United National Front leader Patali Champika Ranawaka said.
Addressing a media briefing today, Ranawaka criticised the government’s tax policy as excessive and potentially harmful to the country’s economic recovery.
“In 2025, the government aims to achieve a revenue target of approximately Rs. 4,300 to 4,400 billion. Compared to the tax revenue of Rs. 1,300 billion during Gotabaya Rajapaksa’s administration in 2020, this means an additional Rs. 3,000 billion must be generated this year. In other words, each individual would need to contribute an additional Rs. 136,000 in taxes compared to 2020,” he said.
Ranawaka argued that the new tax regime, heavily influenced by International Monetary Fund (IMF) conditions, prioritized debt sustainability over the well-being of citizens.
Noting of a stark increase in the withholding tax on bank deposits from 5% to 10% and the imposition of a 15% tax on export-oriented professionals, the former minister claimed that it could deter savings and investment. This decision could potentially have severe repercussions on the banking sector, threatening economic stability, he warned.
“Additionally, the government will need to control expenditures, including capital costs. There are also reports suggesting that advisors have proposed reducing the public workforce by 600,000 employees, though it remains unclear what specific measures will be implemented,” he said.
Under the conditions set by the International Monetary Fund (IMF), the Sri Lankan government is required to maintain a primary surplus of Rs. 657 billion. Ranawaka alleged that the government’s policy appears to follow the same as those of the Ranil Wickremesinghe government in order to achieve this goal. (Newswire)
