Sri Lanka’s New Tax Policy Unit and the Budget-by Suresh R.I Perera
Source:Sundayobserver
As Sri Lanka prepares for the upcoming Budget, the establishment of the dedicated Tax Policy Unit within the Ministry of Finance represents a welcome institutional reform, yet critical concerns remain regarding how it functions in practice.
In my latest column for the Sunday Observer, I examine why separating tax policy formulation from tax revenue collection is essential to avoid ad-hoc, revenue-driven levies that hurt economic growth.
Key concerns highlighted include the need for genuine stakeholder consultation before proposals are finalized, the risk of policy being driven purely by short-term revenue targets rather than long-term competitiveness, and the urgent necessity for transparent economic modeling, especially as Sri Lanka navigates complex domestic reforms and global frameworks like Pillar Two.
For the Budget to deliver true predictability and investor confidence, the Unit must operate with technical autonomy, robust data, and public accountability.
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