Flood Damage and Import Slump Threaten Sri Lanka’s 2025 Revenue Goals

Sri Lanka’s Inland Revenue Department is under rising pressure to meet its revised 2025 tax revenue target of Rs. 4,725 billion, amid major disruptions caused by the recent cyclone and the slowdown in vehicle imports.

At a high-level meeting chaired by Deputy Minister Nishantha Jayaweera, officials emphasised the need to widen the tax net, simplify return filing, and boost taxpayer compliance.

Vehicle import taxeshistorically a key revenue source—have fallen sharply, while thousands of businesses affected by floods are unable to file returns on time.

The government’s revised targets include Rs. 1,210 billion from income tax and Rs. 2,953 billion from goods-and-services levies.

Commissioner General Rukdevi Fernando has been instructed to develop an urgent revenue-mobilisation plan, but officials caution that disaster-related economic disruptions may hinder collections for months.

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