Sri Lanka Unveils 2026 Budget: A Bold Move Towards Economic Revitalization

Sri Lankan President Anura Kumara Dissanayake presented the 2026 budget focusing on tax reforms and increasing state revenue to meet IMF bailout conditions. Initiatives include modernizing tax audits, revising import duties, and constructing houses for the Tamil community. The government aims to reduce debt-to-GDP below 90% by 2032.

In a decisive step towards economic regeneration, Sri Lankan President Anura Kumara Dissanayake unveiled the 2026 budget on Friday. Central to the budget are tax reforms and initiatives aimed at boosting state revenue, both vital components of the ongoing IMF-backed economic restructuring.

Notably, the budget introduces a modern tax audit framework set to commence in January 2026, designed to enhance transparency and minimize corruption. Additionally, the budget plans for strategic revisions in Customs Import Duty rates and a reduction in VAT and Social Security Contribution Levy registration thresholds.

In a humanitarian gesture, LKR 4,290 million has been earmarked, with India's support, to construct homes for the Tamil community. Despite economic challenges, unemployment has dropped, underscoring the government's resolve to achieve a debt-to-GDP ratio below 90% by 2032.

(With inputs from agencies.)