Sri Lanka: Increase of VAT to 18% to boost revenue and meet IMF targets

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In an effort to bolster revenue and align with International Monetary Fund (IMF) program goals, Sri Lanka’s cabinet of ministers has given the green light to raise the value-added tax (VAT) rate from its current 15% to 18%. Additionally, VAT exemptions on certain goods will be eliminated starting in January.

Furthermore, the cabinet has approved a proposal to revise power tariffs on a quarterly basis, transitioning from the current six-month schedule. A bill for a new Employment Act is also in the works following cabinet approval.



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