Tuesday Jan 27, 2026
Tuesday Jan 27, 2026
Thursday, 11 December 2025 06:22 - - {{hitsCtrl.values.hits}}
With Ditwah Cyclone adding tremendous strain on the Government to maintain its fiscal discipline while supporting the economy’s recovery, the Finance, Planning and Economic Development Ministry yesterday said it has initiated a renewed effort to expand the country’s tax net to ensure 2028 tax revenue targets are met.
It aims to do this by simplifying processes, improving public awareness, and strengthening institutional commitment and capacity.
The direction came during a special discussion held on Tuesday on “Measures to be taken to widen the tax net in accordance with the Government’s tax policy.” The meeting was chaired by Deputy Economic Development Minister U.D. Nishantha Jayaweera, with the participation of Inland Revenue Department (IRD) Commissioner General Rukdevi Fernando and senior officials.
During the discussion, the Deputy Minister stressed the need to motivate the public to voluntarily comply with tax obligations.
He called for a structured short-, medium-, and long-term program aimed at increasing awareness among taxpayers and encouraging them to file returns on their own initiative.
Officials were instructed to prioritise educational outreach and to remove barriers that discourage compliance.
Jayaweera also directed the IRD to simplify tax return procedures, minimising the inconvenience faced by taxpayers when submitting documents.
He underscored the importance of creating a system that is easier to navigate, noting that simplification is critical to improving compliance levels and public trust.
The meeting also focused on the IRD’s revenue targets for 2026, with discussions focusing on current needs, resource gaps, and the Government’s support to strengthen revenue collection. Officials were asked to submit a practical and urgent implementation plan to ensure that next year’s goals are met.
Reaffirming the Government’s commitment to strengthening tax administration, the Deputy Minister urged officials to carry out their responsibilities with full dedication.
He noted that the Government is addressing administrative issues and providing necessary facilities to officers to ensure that the IRD can deliver maximum service to the tax-paying public.
During the first nine months of 2025, fiscal performance continued to strengthen, with the Budget deficit more than halving in the first nine months of 2025, according to the Finance Ministry’s latest Fiscal Review Report.
The deficit fell 54.5% year-on-year (YoY) to Rs. 441.4 billion in the first nine months of 2025 from Rs. 970 billion a year earlier, mainly due to higher revenue collections, which grew 31% YoY to Rs. 3.83 trillion from Rs. 2.93 trillion. The primary account surplus more than doubled to Rs. 1.4 trillion.
Income tax revenue rose 12% to Rs. 831 billion, while VAT brought in Rs. 1.24 trillion, up 31% from a year earlier. Customs accounted for nearly half of total tax receipts, collecting Rs. 1.7 trillion and achieving 80% of its annual target.
