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Tax burden on Sri Lankan citizens at the beginning of the year

Afroza Hossain

The Sri Lankan government has imposed a new Value Added Tax (VAT) on various products from the beginning of 2024.

The Sri Lankan government has imposed a new Value Added Tax (VAT) on various products from the beginning of 2024. Consumers will have to pay 18 percent tax on fuel, mobile phones and computer products.

Besides, the rest of the products which had 15 percent Musak so far has also been increased to 18 percent. The government of the country implemented this plan as a plan to increase revenue to overcome the economic recession.

In his New Year message, Sri Lankan President Ranil Wickremesinghe said, “To achieve economic stability, we must move forward on this demand-driven path, which will not be decorated with flowers.” It will be rather challenging.”

At one point during the 2022 mass protests over the economic crisis, the then President Gotabaya Rajapaksa’s house was attacked by angry Lankan mobs. He was forced to resign in July. Ranil Wickremesinghe’s government took tough decisions on the responsibility of foreign debt of 46 billion dollars of the previous government.

The country imposed tax hikes and cuts in government subsidies as conditions for borrowing from the International Monetary Fund (IMF). Accordingly, the first day of 2024 Sri Lankan citizens begin with increased value added tax; Because of which you have to spend extra money to buy different products.

Earlier, the IMF board meeting in mid-December approved the release of the second tranche of the $2.9 billion bailout fund announced for Sri Lanka. The IMF certified that the South Asian country has made “considerable progress” in stabilizing, increasing fiscal revenue, restructuring reserves and controlling inflation.

In September 2022, inflation in Sri Lanka rose to nearly 70 percent. From there, it has come down to one and a half percent last November.

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