https://sputnikglobe.com/20220830/sri-lanka-raises-tax-cuts-expenditure-as-president-aims-to-secure-imf-loans-1100170308.html
Sri Lanka Raises Tax, Cuts Expenditure as President Aims to Secure IMF Loans
Sri Lanka Raises Tax, Cuts Expenditure as President Aims to Secure IMF Loans
Sputnik International
A quarter of Sri Lankan's 22 million population is on the verge of poverty as the depleted foreign exchange reserves triggered unprecedented shortages of... 30.08.2022, Sputnik International
2022-08-30T12:20+0000
2022-08-30T12:20+0000
2022-10-19T18:49+0000
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Sri Lanka has announced a slew of reforms, including raising taxes to bring the economy back on a sustainable public debt path. These are the measures that the International Monetary Fund (IMF) considers essential to secure a bailout package.Presenting an interim budget in the parliament, President Ranil Wickremesinghe said the negotiations with the IMF have successfully reached their final stage.The president, who took over after Gotabaya Rajapaksa fled the country due to a popular uprising in July, said the government would aim to tame inflation and introduce legislation to bolster central bank's independence.The government has decided to raise the taxes despite inflation reaching 60 percent in July. As a part of “efficient expenditure management,” the Sri Lankan government proposed rationalizing the number of government employees with mandatory retirement of all who reached 60 years of age.To curb the dependency on crude oil imports, the government has decided to buy only electric-powered vehicles for the use of public sector in the future. The president also announced formulating a new public finance management law and setting up a national debt management agency to improve the fiscal health of the $81 billion economy.Wickremesinghe has decided to design a new defense policy, “National Security - 2030,” to face the emerging realities of the changing geo-strategic competition in the Indian Ocean. The decision to review defense policy holds importance as India and China crossed swords last week over deploying a PLA scientific research vessel at a port in Sri Lanka.The island nation owes $51 billion to foreign countries, and multilateral institutions. Wickremesinghe blamed the politicization of economic policies for the personal benefit of the previous government for the collapse of Sri Lankan economy.
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sri lanka, debt, reforms, imf, ranil wickremesinghe, gotabaya rajapaksa, china
Sri Lanka Raises Tax, Cuts Expenditure as President Aims to Secure IMF Loans
12:20 GMT 30.08.2022 (Updated: 18:49 GMT 19.10.2022) A quarter of Sri Lankan's 22 million population is on the verge of poverty as the depleted foreign exchange reserves triggered unprecedented shortages of essential goods such as food, fuel and medicines in the island nation. President Ranil Wickremesinghe aims to bring the cash-strapped economy on track by 2024-25.
Sri Lanka has announced a slew of reforms, including raising taxes to bring the economy back on a sustainable public debt path. These are the measures that the International Monetary Fund (IMF) considers essential to secure a bailout package.
Presenting an interim budget in the parliament, President Ranil Wickremesinghe said the negotiations with the IMF have successfully reached their final stage.
The president, who took over after Gotabaya Rajapaksa fled the country due to a popular uprising in July, said the government would aim to tame inflation and introduce legislation to bolster central bank's independence.
The government has decided to raise the taxes despite inflation reaching 60 percent in July.
“The Value Added Tax rate will be increased to 15 percent from the current rate of 12 percent with effect from 1st September 2022,” Wickremesinghe said.
As a part of “efficient expenditure management,” the Sri Lankan government proposed rationalizing the number of government employees with mandatory retirement of all who reached 60 years of age.
To curb the dependency on
crude oil imports, the government has decided to buy only electric-powered vehicles for the use of public sector in the future.
The president also announced formulating a new public finance management law and setting up a national debt management agency to improve the fiscal health of the $81 billion economy.
Wickremesinghe has decided to design a new defense policy, “National Security - 2030,” to face the emerging realities of the changing geo-strategic competition in the Indian Ocean.
The decision to review defense policy holds importance as India and China crossed swords last week over deploying a PLA scientific research vessel at a port in Sri Lanka.
The island nation owes
$51 billion to foreign countries, and multilateral institutions.
Wickremesinghe blamed the politicization of economic policies for the personal benefit of the previous government for the collapse of Sri Lankan economy.
