Sri Lanka has lost more than Rs. 25 billion in potential tax revenue since 2025 due to cigarette taxation falling below the World Health Organization’s (WHO) recommended benchmark, according to the newly launched Cigarette Tax Leakage Tracker by Colombo‑based think tank Verité Research.

The dashboard, hosted on PublicFinance.LK, reveals that the country is losing revenue at staggering rates, Rs. 547 every second, Rs. 32,842 every minute, Rs. 47.3 million every day, amounting to Rs. 1.4 billion each month and Rs. 17.3 billion annually. 

In the first six months of 2026 alone, the shortfall exceeded Rs. 8 billion.

The WHO recommends that cigarette taxes account for at least 75% of the retail price. Sri Lanka last came close to this target in 2018, reaching 74%. 

However, the tax share has since declined, dropping to 67% from 2025 onwards, widening the gap between actual collections and potential revenue.

Verité Research notes that the government could plug this leak by gazetting increases to excise taxes across all cigarette categories.

Proposed revisions include raising the tax on cigarettes up to 60 mm from Rs. 19.35 to Rs. 22.90, and on 60–67 mm cigarettes from Rs. 50.15 to Rs. 60.11, among other adjustments.

If implemented, these measures would reduce the Ceylon Tobacco Company’s 2025 profits of Rs. 53.9 billion by Rs. 17.3 billion, while significantly boosting government revenue.

The Cigarette Tax Leakage Tracker provides policymakers, researchers, and the public with real‑time visibility into these missed opportunities.

The dashboard can be seen on PublicFinance.LK, Sri Lanka’s premier platform for public finance insights and analysis.

https://dashboards.publicfinance.lk/cigarette-tax-leakage/ (Newswire)

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The run rate of passing laws in Sri Lanka’s Parliament has shifted over time, with President Anura Kumara Dissanayake’s administration overtaking that of former President Maithripala Sirisena in legislative output at the 18‑month mark, according to a report by Colombo‑based think tank Verité Research.

The study compares legislative activity during the first 18 months of the two presidencies, both elected on platforms of anti‑corruption and governance reform. 

At six months, Sirisena’s presidency led decisively, having gazetted three times more bills and passed twice as many laws as Dissanayake’s. 

However, by nine months, the AKD presidency had caught up in terms of laws passed, and by 18 months, had enacted 32 laws compared to 20 under Sirisena.

While Sirisena’s government consistently led in the number of bills gazetted, 54 compared to Dissanayake’s 50, the report notes that the AKD presidency converted a much larger share of its gazetted bills into law. 

Parliament met for 126 days during Sirisena’s first 18 months and 136 days under Dissanayake, with both periods including an interim budget and a full‑year budget.

Verité Research concludes that the AKD presidency demonstrates greater efficiency in translating legislative proposals into enacted laws, marking a significant difference in parliamentary performance between the two reformist administrations.

Table 1: Legislative record of Parliament, 6 months in

Table 2: Legislative record of Parliament, 18 months in

(Newswire)

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A Colombo-based think tank, Verité Research, says Sri Lanka could lose the Governance-Linked Bond offer of USD 70 million in debt relief due to a fiscal planning oversight. 

In a post on social media, Verité Research states that Sri Lanka will receive USD 70 million in debt relief from its Governance-Linked Bond (GLB) upon meeting two revenue targets.

The think tank points out that, however, the issue lies with the Sri Lankan government’s revenue expectations in the fiscal strategy statement, which are lower than the GLB targets.

According to Verité Research, the GLB targets are 15.3% in 2026 and 15.4% in 2027, but the government’s targets are 15.2% in 2026 and 15.3% in 2027. 

It is reported that the government’s revenue targets for the next two years follow the latest IMF expectations. But they are slightly lower than what’s needed to trigger the debt relief available from the Governance-Linked Bond. 

As such, Verité Research proposed that the government adjust the revenue targets in the upcoming budget to match the GLB targets. (Newswire)

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Colombo-based think tank Verité Research has launched ‘The Budget Proposal Hub’, a first-of-its-kind trilingual platform that empowers people to participate in the national budget process by submitting proposals for the consideration of parliament, as well as by voting on proposals.

According to Verité Research, the aim is to encourage the participation of people and organisations in a process that is hugely consequential to their future. 

Those who engage with the platform will receive 

(a) Templates and guidance on drafting credible proposals 

(b) Assistance in engaging with government and parliament.

(c) Publicity and social engagement on their proposals.

A novel feature of The Budget Proposal Hub is that it allows everyone to vote for and speak in support of the budget proposals that they wish to endorse.

The trilingual platform is now live on publicfinance.lk. Visit https://bit.ly/Budget_Proposal_Hub to directly access. 

Full statement;

Sri Lanka has lacked effective and convenient channels for public participation in the budget process. In the Open Budget Survey 2023, Sri Lanka had the lowest participation score in a decade, and ranked 82nd out of 125 countries.Innovation in Budget Proposal Submission

The Budget Proposal Hub launched by Verité Research in Sri Lanka, is a first of its kind trilingual platform that empowers people to participate in the national budget process by submitting proposals for the consideration of parliament; as well as by voting on proposals.

The aim is to encourage the participation of people and organisations in a process that is hugely consequential to their future. Those who engage with the platform will receive 

(a) Templates and guidance on drafting credible proposals 

(b) Assistance in engaging with government and parliament.

(c) Publicity and social engagement on their proposals.

Voting allows everyone to participate

The Budget Proposal Hub has a novel feature: it allows everyone to vote for and speak in support of the budget proposals that they wish to endorse.

That means, even though not everyone will be able to craft a budget proposal, everyone can still participate in the process by engaging with the proposals and voting on them.

The trilingual platform is now live on publicfinance.lk, visit https://bit.ly/Budget_Proposal_Hub to directly access. All are invited to participate by submitting, or voting on, proposals for the 2026 Budget. Verité Research welcomes participation and support for this initiative from all sections of society. For more information and to support the initiative, email pfp@veriteresearch.org. (Newswire)

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In 2024, the government disclosed only 40% of the required information on foreign-financed projects, according to Sri Lankan think-tank Verité Research.

This was revealed in the 2024 update of Infrastructure Watch, a dashboard on PublicFinance.LK – Sri Lanka’s premier economic insights platform. 

Issuing a statement, Verité Research said this platform has tracked government compliance with the RTI Act’s proactive disclosure requirements since 2022.

Verité Research points out that large infrastructure projects of the government are often financed by foreign loans and grants and when the amount exceeds USD 100,000, the law requires information about the projects to be disclosed to the public online. 

However, compliance with the law is poor and in 2024, the government has disclosed only 40% of the required information on foreign-financed projects.

Verité Research states corruption in public spending is often linked to public procurement and its economic insights dashboard shows that disclosure of procurement-related information for foreign-financed projects was even less – only 20% of what the law requires.

Economist and Director at Verité Research Subhashini Abeysinghe says that “foreign lenders can help improve transparency by linking their project financing to government compliance with the Right to Information Act.” 

Improving transparency is not only in the interest of the Sri Lankan public but also benefits lenders and contractors involved in these projects. Subhashini Abeysinghe says that “greater transparency not only fosters fair competition and reduces the risk of corruption, but also minimizes reputational risks for lenders and contractors of being implicated in corrupt practices.”

Section 9 of the RTI Act and the guidelines published by the RTI commission mandate the proactive disclosure of information under five broad categories: project details, rationale & beneficiaries, budget & financial details, approvals & clearances, and procurement & contracts.

The 2024 assessment looked at compliance concerning 50 large infrastructure projects. The dashboard can be accessed by visiting https://dashboards.publicfinance.lk/infrastructure-watch/ (Newswire)

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Sri Lanka failed to meet 30% of its International Monetary Fund (IMF) programme commitments by the end of April 2024, according to PublicFinance.lk. 

Sri Lanka’s premier platform for economic insights revealed that the failure to meet the commitments translates to a total of 19 unfulfilled obligations. 

The majority of these unmet commitments pertain to enhancing transparency and enacting legislation. 

Following is the summary of commitments that are not yet due:

https://publicfinance.lk/en/topics/30-of-imf-programme-commitments-due-in-april-not-met-1715845770 (Newswire)

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Sri Lankan think-tank, Verité Research has launched a ‘Blueprint for a Rational Government in Sri Lanka’ with just 15 ministries.

The publication shows how all the duties, functions, institutions, and laws in Sri Lanka can be structured and organized in an efficient and effective manner, even with just 15 ministries.

It draws on the work of the acclaimed 1988 Administrative Reform Commission as well as exemplary international practices, to design a highly functional structure for organising government and all its activities in Sri Lanka.

The design of this Blueprint is based on minimising two significant problems that can arise in the formation of cabinet ministries.

1. Fragmentation: this is when related subjects are split across different ministries. For example, at one time the subjects of Agriculture, Irrigation, Livestock Development and Fertiliser were split across different ministries.
2. Misalignment: this is when unrelated subjects are grouped together under the same ministry. For example, there was a single Ministry for Tourism, Wildlife and Christian Religious Affairs all lumped together, and another ministry lumping together Telecommunications, Foreign Employment and Sports.

Additionally, there is the problem of frequent changes that make the government even more dysfunctional. For instance, from 2010 to 2023, the compositions of ministries, including the institutions, and acts assigned to them, were changed by at least 111 gazettes, with each of these gazettes usually making multiple changes to the structure of government.

The Blueprint document is set out in the form of the gazette that the government is required to publish when a cabinet is formed; completely incorporating all aspects of government that need to be assigned to a well-designed set of ministries. The theory and thinking behind the design were published in 2020 in a Verité Research White Paper titled ‘A Rational Method for Cabinet Formation in Sri Lanka’.

The two documents are being presented to all major political parties in Sri Lanka to assist with the hard work of designing a structure of government that serves the people of Sri Lanka in an efficient and effective manner.

For more information and access to these documents, please visit https://www.veriteresearch.org/publication/blueprint-for-a-rational-cabinet-in-sri-lanka/. (Newswire) 

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A closed-door event titled ‘Sri Lanka: Pathways to Debt Sustainability & Governance Reform’ will be held today (13 October) alongside the International Monetary Fund (IMF) Annual Meetings in Marrakesh, Morroco, hosted by organisations connected to the ‘Sri Lankan Civil Society Initiative on Anti-Corruption Reform for Economic Recovery’. 

The event will focus on two key priorities in steering Sri Lanka to recovery from its debt crisis:

1)the two recent governance diagnostics on Sri Lanka by civil society and the IMF and 

2) the role of the IMF, the government, and the country’s creditors in achieving a successful and sustainable restructuring of Sri Lanka’s debt. 

The ‘Civil Society Governance Diagnostic Report on the Anti-Corruption Landscape of Sri Lanka’ was released in mid-September. This was a comprehensive set of 34 governance reform recommendations for Sri Lanka aimed at addressing the root causes of Sri Lanka’s current crisis. In late September, the IMF released its governance diagnostic on Sri Lanka, which is the first-ever IMF governance diagnostic in Asia. 

These two governance diagnostics have the potential to establish a solid foundation for improving the rule of law, transparency and accountability. They will be discussed at the event as improvements in debt governance are vital to prevent countries from experiencing recurrent debt problems. 

The event will also delve deeper into the need for stricter debt sustainability targets, including significant haircuts with Sri Lanka’s external creditors that would reduce the overall debt stock. 

IMF Senior Mission Chief for Sri Lanka Peter Breuer, Verité Research Executive Director Dr. Nishan de Mel, Transparency International Sri Lanka Executive Director Nadishani Perera and Global Sovereign Advisory Senior Research Analyst Theo Maret will be speaking and answering questions. The panel will be moderated by Thomson Reuters Emerging Markets Correspondent Jorgelina do Rosario. 

Invitees for this closed-door event include several executive directors of the IMF Board, regional heads of multilateral institutions, a number of major stakeholders and professionals, and the top-ranking members of the Sri Lankan delegation to the IMF annual meeting in Marrakesh. (NewsWire)

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Sri Lanka verifiably met 38 of the 57 trackable commitments that were due for completion by end-August in its 17th programme with the International Monetary Fund (IMF), according to the latest progress update by Sri Lankan think-tank Verité Research.

The end-August update on the programme by ‘IMF Tracker’, an online platform by Verité Research, shows that the progress on 11 commitments remains “unknown”, while eight are now classified as “not met”.

An IMF team arrived in Sri Lanka this week to review the progress on the programme which kicked off in March 2023 and approve the second disbursement – which is now expected to be delayed till at least the end of October.

The IMF review is likely to focus on commitments that were due by the end of June. Even with that large latitude, Sri Lanka is falling short on an important governance-linked commitment. That is, the establishment of an online fiscal transparency platform. This was due by end-March but is yet to be delivered.

Fiscal Transparency Platform – what is expected? 

The expectation is that this platform will publish semi-annually three types of information: 

(1) all significant public procurement contracts, 

(2) a list of all firms receiving tax exemptions through the Board of Investment, and 

(3) a list of individuals and firms receiving tax exemptions on luxury vehicle imports. 

Such a platform can shed light on government actions and curtail the abuse of power to confer private advantage, at the cost of public revenue. 

This is also the first Sri Lanka programme in which the IMF has identified governance and corruption issues as being critical for macro-economic recovery and stability in Sri Lanka. The fiscal transparency platform gains added importance in that light. 

The IMF has a track record of overlooking failures to meet commitments, especially when they occur due to circumstances that might be outside the control of the government. This act of omission, however, is one that is well within the government’s control. Overlooking it can make the IMF appear to not be giving due weight to its own evaluation about the importance of governance related commitments – and encourage further slippage in future actions related to improving governance in Sri Lanka.

IMF Tracker is the first and only platform in Sri Lanka which tracks the 100 identified commitments recorded along with Sri Lanka’s letter of intent to the IMF on the programme approved on 20 March 2023.  It is available for the public on the manthri.lk website at manthri.lk/en/imf_tracker (NewsWire)

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Despite the Right to Information (RTI) Act’s proactive disclosure requirement, only 18% and 25% of the information required to be disclosed on large-scale infrastructure projects were proactively disclosed online in 2022 and 2023 respectively, according to Sri Lankan think-tank, Verité Research.

Verité Research states the information, when available online, was mostly available in English – even though the RTI Act mandates disclosure in Sinhala and Tamil, with English required only if feasible. In 2022, 18% of the information was available in English, but only 5% in Sinhala and 4% in Tamil. This trend continued in 2023, where 25% was available in English, with only 8% in Sinhala and 8% in Tamil.

These findings are contained in Infrastructure Watch, a trilingual dashboard housed under Verité Research’s publicfinance.lk platform. It tracked government compliance with the RTI Act’s proactive disclosure requirements for 60 projects worth LKR 1.08 trillion in 2022, and 60 projects worth LKR 2.54 trillion in 2023. The 2023 assessment’s 60 projects comprised 37 old projects from the 2022 assessment that were ongoing, as well as 23 new projects. 

The assessment period for the 60 projects in 2022 was January – April 2022 and for 60 projects in 2023 was January – April 2023. The assessment considered only the proactive disclosure of information on the websites of the responsible Ministries and line agencies.

Verité Research points out that Section 9 of the RTI Act No. 12 of 2016 mandates the Minister responsible for an infrastructure project to disclose project information. The information should be proactively disclosed for foreign and locally funded projects exceeding USD 100,000 and LKR 500,000 respectively, at least three months prior to commencement. The disclosures are to be made under 5 broad categories: project details, rationale and beneficiaries, budget and financial details, approvals and clearances, and procurements and contracts.

Sri Lanka’s large-scale infrastructure projects have been mired with allegations ranging from corruption, procurement malpractices, unreasonably high costs and negligence of negative environmental impacts. Loans undertaken to fund these projects during the past two decades have also contributed significantly to Sri Lanka’s debt burden.

Lack of transparency is a key enabler of many of the problems associated with infrastructure investments in Sri Lanka. The Right to Information (RTI) Act, brought into effect in 2016, attempted to change this by enabling public access to vital government information and empowering citizens to hold the government accountable.

Disclosure of public procurement contracts through an online fiscal transparency platform to reduce opportunities for corruption is also a commitment Sri Lanka has made with the IMF. Yet, the assessment revealed that a significant share of critical information important to improving infrastructure governance, such as project approvals and clearances and project procurement and contracts, remains hidden from the public. 

Verité Research added that the government’s continued lack of transparency surrounding infrastructure projects therefore begs the question as to whether the government will continue to carry out its business behind closed doors, defying legal mandates.

The details of the 60 projects tracked can be accessed by visiting https://dashboards.publicfinance.lk/infrastructure-watch/. (NewsWire)

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The share of Sri Lanka’s 100 trackable commitments in the International Monetary Fund (IMF) programme, for which no data has been made available to assess progress, has increased from 9% in March to 15% in July, according to Sri Lankan think-tank Verité Research.

Issuing a statement, Verité Research pointed out that no data has been made available to assess the progress of 15% of Sri Lanka’s 100 trackable commitments in the IMF programme despite passing the agreed deadline.

The lack of information to make a reasonable assessment about these commitments, the think tank notes, highlights a growing lack of visibility on the government’s progress on the IMF programme.

What can explain the increase in “Unknown” progress?

The findings are based on the IMF Tracker of Verité Research, which tracks the programme’s progress and classifies commitments as “met”, “not met”, or “unknown” on verifiable criteria.

Verité Research points out that the rise in the number of commitments, on which the achievement is “unknown”, could mean one of two things. One, the government has failed to meet these commitments and is not making the information public to delay the recognition of failure. 

Two, the government does not see the public or parliament as important stakeholders in programme implementation — and is uninterested in providing them with critical information.

Can Sri Lanka pick up the rate of progress?

Sri Lanka had verifiably met 35 of the 57 commitments on the IMF programme that were due to be completed by the end of July; up from 33 in June. In July, the parliament approved the Central Bank of Sri Lanka Bill and the Anti-Corruption Bill. These bills were originally due to be approved in April and June 2023, respectively. This means that Sri Lanka is moving forward slowly and with a significant delay against the agreed timelines.

Since March, when Sri Lanka started off well with 25 commitments already completed, the average rate of verifiable completion has been less than three per month. 

There are 71 commitments due to be completed by the end of September when the IMF conducts its first review of the programme and would normally disburse the second tranche of funding. To get there, Sri Lanka needs to verifiably complete 18 commitments a month in August and September.

In evaluating progress, any policy-related action that lacks public disclosure of their completion status even two months after the due date is deemed not met. 

Consequently, the commitment set for April regarding the “completion of the asset quality review component of the diagnostic exercise for the two largest state-owned banks and the three leading private sector banks” has been reclassified from “unknown” to “not met.” 

A total of seven commitments were classified as “Not Met” at the end of July.

The IMF Tracker is now available for the public on manthri.lk. For more information, please visit: https://manthri.lk/en/imf_tracker (NewsWire)

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Approximately 60% of the public do not believe that the ‘Aragalaya’ movement led to the wishes and aspirations of the people being fulfilled, a new survey by Sri Lankan think-tank, Verité Research has found.

As per the survey,  51% of the respondents said that corruption and bad governance needs to be fixed in order to rebuild Sri Lanka.

The Aragalaya protest movement had a significant presence in Galle Face from 9 April 2022 till 10 August 2022. Today marks one year since Aragalaya protestors vacated the Galle Face Green.

Wishes and aspirations fulfilled?

To the question ‘Do you think the Aragalaya led to the wishes and aspirations of the people being fulfilled?’, 60% responded with ‘mostly no’, 11% with ‘mostly yes’, while 29% said they have ‘no opinion’.

The appointment of a new prime minister and a cabinet of ministers, and the resignation of President Gotabaya Rajapaksa were some of the important events which took place during this period.

Governance, stability or economic system?

The respondents were also asked, ‘Out of the following statements, which one would you endorse the most?’

1. In order to rebuild the country, it is necessary to give priority to stability over democratic space
2. In order to rebuild the country, it is necessary to fix corrupt and bad governance
3. In order to rebuild the country, it is necessary to change the economic system

A majority of the respondents – 51% – believe that it is necessary to fix corrupt and bad governance. 

34% desire a change in the economic system and 15% consider it necessary to give priority to stability over democratic space.

Implementation of the survey

The poll is conducted as a part of the syndicated survey instrument by Verité Research and the polling partner was Vanguard Survey (Pvt) Ltd. The syndicated survey instrument by Verité Research also provides other organisations with the opportunity to survey the sentiments of the people of Sri Lanka. 

The sample and methodology are designed to limit the maximum error margin to under ±3% at a 95% confidence interval. The poll is based on an islandwide nationally representative sample of responses from 1,008 Sri Lankan adults, conducted in June 2023. (NewsWire)

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Sri Lanka ranks 104th out of 125 developing and least developed countries (LDCs) in its implementation of trade facilitation measures over the last six years, a new study by Sri Lankan thin-tank, Verité Research has found.

According to the think-tank, alarmingly, 21 out of 35 LDCs have a higher rate of implementation than Sri Lanka, which has progressed only marginally from a rate of 29% in 2017 to 31.5% in June 2023.

Sri Lanka has also claimed to have less capacity than LDCs to implement trade facilitation measures. For example, the country has stated that it cannot implement over 69.3% of the trade facilitation measures without external assistance.

By contrast, developing countries and LDCs on average claim to require external assistance to implement only 21.7% and 40% of trade facilitation measures, respectively. Of the 125 LDCs and developing countries party to the World Trade Organisation’s Trade Facilitation Agreement (WTO TFA), only 10 countries (including Sri Lanka) have requested external assistance to implement over 69% of trade facilitation measures.

The study by Verité Research compared Sri Lanka’s progress in trade facilitation against its regional competitors, other developing countries, and least developed countries. Country-wise information published by the World Trade Organisation in its trade facilitation database was used for this comparison. The database contains the commitments and notifications on the progress of the implementation of trade facilitation measures, by countries that are signatories to the WTO TFA.

Verité Research proposes three steps Sri Lanka can take to outperform LDCs and catch up with its peers. It also identifies 10 trade facilitation measures Sri Lanka can prioritise and implement without delay.

The first step is for Sri Lanka to take action to implement measures on its own, without delaying implementation by waiting for external assistance. For example, the country claims it cannot promptly publish information on trade procedures, taxes, fees etc., in a non-discriminatory and easily accessible manner, without external assistance. However, 54% of the LDCs and 80% of the developing countries state that they have already implemented this, or can implement it on their own, without external assistance. This stance taken by Sri Lanka reflects poorly on the country and sends a negative signal to potential traders and investors.

The second step is to provide high-level leadership to overcome the resistance of government agencies to trade facilitation implementation and to influence the allocation of necessary resources to facilitate implementation. The National Trade Facilitation Committee (NTFC) of Sri Lanka, established to spearhead the implementation of trade facilitation measures, is co-chaired by the director general of Sri Lanka Customs and the director general of the Department of Commerce. This is in stark contrast to countries like Vietnam, India, and Bangladesh, (all three have made better progress than Sri Lanka) where the NTFC is chaired by the deputy prime minister, cabinet secretary and minister of commerce, respectively.

The third step is the publication of the trade facilitation action plan and instituting a mechanism to monitor and report progress. For example, India has published its trade facilitation action plan online and has instituted a robust system to monitor its progress. As a result, the country has not only fully implemented all the trade facilitation measures included in WTO TFA, but is moving beyond WTO TFA by implementing additional measures to further facilitate trade.

The full study by Verité Research can be accessed via: https://www.veriteresearch.org/publication/sri-lanka-falls-behind-least-developed-countries-trade-facilitation/ (NewsWire)

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The implementation status of 71 per cent of the highest value expenditure proposals in Interim Budget 2022 – with an allocation of LKR 46.8 billion – remains unknown, according to Sri Lankan think tank, Verité Research.

Verité Research stated that it has been tracking the progress of budget promises since 2017, and Interim Budget 2022 has the largest proportion of proposals for which information was not provided. On average, information was not disclosed to assess the progress of 38 per cent of the expenditure proposals between 2017-2021.

For most of the Interim Budget 2022 proposals, no information was provided by the government agencies, even for requests made under the Right to Information (RTI) Act. This has been a continuing trend since 2017.

The Interim Budget 2022 assessment tracked 24 expenditure proposals made in the budget speech, with a total allocation of LKR 50.5 billion. Information received was sufficient to assess the progress of seven proposals, and the assessment revealed that only one proposal had been fulfilled as of 31 December 2022, the think tank stated.

The findings are published on the ‘Budget Promises’ dashboard housed under the publicfinance.lk platform of Verité Research.

According to Verité Research, the assessments over the years reveal that a key factor that contributes to poor disclosure of progress is the confusion over who is responsible for the implementation of the proposals. The National Budget Department (NBD) of the Ministry of Finance is responsible for budget implementation but is not fully aware of the agencies responsible for the implementation of proposals. For example, the agencies identified by the NBD as being responsible for implementation claimed they are not responsible for the implementation of 17 out of the 24 proposals tracked.

This indicates one of two possibilities:

1) the NBD, which is responsible for the estimation and appropriation of public finance resources, is unaware of who the implementing agencies are or

2) the agencies are not aware that they are responsible for the implementation of these proposals. Both possibilities raise serious concerns about the accountability of the government in delivering promises made by the Minister of Finance in his budget speech in Parliament.

Verité Research further stated that the Interim Budget 2022 was presented at a crucial juncture in Sri Lanka’s history when the country was mired in an economic crisis unlike any it has faced since independence. The budget strived to provide hope by promising to lay the foundation to change the economic trajectory of the country.

These findings raise doubts as to whether Sri Lanka can genuinely expect a sustainable change in its economic trajectory without addressing the core problem that led to the crisis; lack of transparency and accountability in how the government manages public funds, the think tank stated. 

Verité Research added that the importance of enhancing fiscal transparency to reduce corruption vulnerabilities and restore long-term economic and political stability has been highlighted in Sri Lanka’s commitments with the International Monetary Fund (IMF). Increasing transparency about how the government spends public funds is a critical step in achieving these goals.

For information about the proposals tracked, responsible agencies and other findings, visit https://dashboards.publicfinance.lk/budget-promises/. (NewsWire)

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Sri Lanka has verifiably met 33 of the trackable programme commitments of the International Monetary Fund (IMF) programme as of the end of June 2023 but has failed eight of the commitments.

Sri Lanka’s performance has been monitored by the ‘IMF Tracker’, an online tool launched by Sri Lankan think-tank, Verité Research.

According to Verité Research, growing number of failed commitments, the number of unfulfilled commitments doubled from four (including one partially met) in May, to eight in June 2023. 

These include obtaining cabinet approval for the restructuring plan of key State-Owned Enterprises (SOEs), enacting new anti-corruption legislation, publishing the annual reports of all 52 major SOEs for 2022, and preparing a plan to gradually eliminate import restrictions.

Sri Lanka is mostly failing in two areas: the passage of legislation, and information dissemination. Between March and June, the country committed to enacting three significant laws: a revision of betting and gaming levies, the enactment of the Central Bank of Sri Lanka Act, and a new Anti-Corruption Act. Drafts of these bills were published on the website of the Printing Department on the 4th of April, 7th of March, and 27th of April 2023, respectively. However, these drafts are still pending parliamentary approval and enactment. 

On the information dissemination front, three primary commitments remain unfulfilled. The first is the establishment of a fiscal transparency platform, to semi-annually publish significant public procurement contracts, a list of firms receiving tax exemptions through the Board of Investment, and a list of individuals and firms receiving tax exemptions on luxury vehicle imports. This remains undone.

The second commitment pertains to the publication of annual reports for all 52 major SOEs up to 2022. A recent infographic by publicfinance.lk revealed that only 11 out of the 52 key SOEs have published their annual reports up to 2022. This lack of information dissemination can also be seen in the non-publication of a plan to phase out import restrictions.

Lack of Information is also a concern. As of the end of June, the commitments classified as “unknown”, where the information required to make an assessment was not available, had risen to 14%, more than double the percentage of the previous month (6%).

Verité Research notes that timely progress on the IMF programme has two benefits. First, there are the material benefits that can result from many (not all) of the actions. Second, it can improve confidence in Sri Lanka’s governance, which then helps negotiations restructure the burden of past debt and speed up the path to future economic recovery.

‘The IMF Tracker’ is currently tracking 100 identified commitments recorded along with Sri Lanka’s Letter of Intent to the IMF on the programme approved on 20 March 2023. The platform will assist the government and people of Sri Lanka, as well as the IMF, to better understand and track Sri Lanka’s progress and timeliness in meeting these commitments.

The IMF Tracker is now available to the public on manthri.lk – an online platform run by Verité Research – tracking the actions and performance of Sri Lanka’s parliament. For more information, please visit: https://manthri.lk/en/imf_tracker (NewsWire)

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The Central Bank’s Annual Report for 2022 shows the government’s revenues witnessed a notable surge of 38%, soaring from Rs 1,484 billion to Rs 2,013 billion, Sri Lankan think-tank, Verité Research reported.

As per the report, a closer examination of the revenue breakdown reveals that a substantial portion of this growth stems from increments in Value Added Tax (VAT), Personal Income Tax and Corporate Tax, which experienced respective increments of Rs 155 billion and Rs 212 billion. 

Verité Research’s report further states improving fiscal consolidation will be of paramount importance as Sri Lanka advances in its International Monetary Fund (IMF) program. (NewsWire)

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Sri Lanka had met 29 of the 100 trackable commitments of the International Monetary Fund (IMF) programme and had failed on three as of the end of May 2023, according to ‘The IMF Tracker’ dashboard of Verité Research. 

A statement by Colombo-based think tank Verité Research shows, two of the failed commitments relate to revenue. The first is to increase tax revenue to 2.1 per cent of Gross Domestic Product (GDP), or Rs. 650 billion, by March 2023. Total government tax revenue was only Rs. 578 billion in the first quarter of 2023.

The second commitment is to increase the tax rates pertaining to the Betting and Gaming Levy in line with a May 30 tax proposal. This involves increasing the annual levy on gaming to LKR 500 million, the annual levy on betting carried through agents to Rs. 5 million, the annual levy on betting carried using live telecasting to Rs. 1 million, the annual levy on betting carried without live telecasting to Rs. 75,000 and the levy on gross collection to 15%. A bill was published on the 4th of April but an amendment to the act has not been made.

One commitment, the establishment of an online fiscal transparency platform, was partially met by end-May. This platform is expected to publish, on a semi-annual basis, information related to (i) all significant public procurement contracts, (ii) a list of all firms receiving tax exemptions through the Board of Investment, and (iii) a list of individuals and firms receiving tax exemptions on luxury vehicle imports.

The third unmet commitment was parliamentary approval of the new Central Bank Act, prepared in consultation with IMF staff. Even though a bill was published on 7 March, an amendment to the act has not been made.

Six of the identified commitments had their progress status in the tracker classified as unknown as of end-May. This means the information required to make an assessment was not available. While this is an improvement in March and April, the lack of information is still a concern.

Verité Research notes that timely progress on the IMF programme has two benefits. First, there are the material benefits that can result from many (not all) of the actions. Second, it can improve confidence in Sri Lanka’s governance, which then helps negotiations restructure the burden of past debt and speed up the path to future economic recovery.

‘The IMF Tracker’ is the first and only platform in Sri Lanka which tracks 100 identified commitments recorded along with Sri Lanka’s letter of intent to the IMF on the programme approved on 20 March 2023. The platform is designed to assist the government and people of Sri Lanka, as well as the IMF, to better understand and track the progress made on these commitments.

The tool is available for the public at manthri.lk/en/imf_tracker. (NewsWire)

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