• A Sri Lankan delegation discussed tax revenue targets with the IMF, focusing on increasing VAT and other taxes for the 2025 budget.While no final decisions were made, the IMF prefers revenue hikes over spending cuts to address the primary deficit.

A Sri Lankan delegation recently discussed taxes and revenue targets with the IMF in the US, focusing on VAT and other tax revenues, though no final decisions were made, according to Minister Vijitha Herath. As Sri Lanka prepares its 2025 budget, it faces IMF requirements to set revenue and primary balance targets for June 2025 as part of quantitative performance criteria for the next staff-level agreement. The IMF emphasizes boosting revenues over spending cuts, although both approaches could address the primary deficit. While a review of June 2024 data was initially scheduled for September, it was delayed due to upcoming elections. Sri Lanka's new administration is planning a vote on account while working on next year’s budget, which must align with IMF program parameters for board approval, as certain revenue measures were expected to be implemented under the current program.

Sri Lanka delegation discussed taxes, revenues with IMF: Minister | Economy Next