Sri Lanka budget banks on car taxes to boost coffers

Sri Lanka’s President Anura Kumara Dissanayake unveiled his first budget, focusing on boosting revenue through the liberalization of vehicle imports to revive the country’s struggling economy. Dissanayake explained that the main revenue gains for 2025 were expected to come from this policy, which took effect on February 1, 2025.

He emphasized that Sri Lanka’s economic reform program was centered on revenue-based fiscal consolidation, noting the country’s historically low government tax revenue, which stood at just 7.3% of GDP in 2022. The government closely monitored the impact of vehicle imports to avoid any negative effects on the stability of the external sector.