Sri Lanka’s state revenue surges to record Rs. 834 Billion in first quarter 2024

Lotus tower in Colombo, Sri Lanka

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State revenue of Sri Lanka has reached an impressive Rs. 834 billion in the first quarter of this year, State Minister of Finance, Ranjith Siyambalapitiya announced on Thursday (April 25).

According to Minister Siyambalapitiya, this achievement not only surpasses the projected revenue but also indicates a growth of 6%.

State Minister Siyambalapitiya made these remarks during his participation in a press briefing held at the Presidential Media Centre (PMC) on Thursday (April 25), under the theme ‘Collective Path to a Stable Country’.

The state minister emphasized that with prudent financial management and a consistent revenue pattern, 2024 promises to be a year where revenue targets can be successfully attained.

Expressing his views, State Minister Ranjith Siyambalapitiya further stated that,

The Department of Treasury Operations is encountering a challenging task in handling cash flow this year. This difficulty arises from the limitations imposed by existing laws, which prohibit obtaining loans and printing money. Moreover, government spending has escalated, attributed to both welfare and recurrent expenses. However, it is noteworthy that effective financial management practices are underway in the country.

In comparing recurring expenses between the first quarters of 2020 and 2024, there has been a substantial increase of 35% in the latter period. Notably, there is a significant surge of 114% in loan interest repayment and a noteworthy uptick of 60% in capital expenditure. Furthermore, the capital repayment of public debt has escalated by 177%, indicating substantial financial commitments.

Shifting focus to welfare expenditure, in the first quarter of 2020, Rs. 93,670 million was allocated for Samurdhi. However, in the corresponding period of 2024, this figure has risen to Rs. 117,107 million, reflecting a notable growth of 25% compared to 2020. These figures underscore the evolving financial landscape and the increasing demands on government resources for welfare provisions.

In the first quarter of this year, state revenue surged by 6% while beating initial expectations, with anticipated revenue of Rs. 787 billion.

However, the actual revenue collected reached an impressive Rs. 834 billion, showcasing a remarkable achievement. The Inland Revenue Department led the charge, contributing Rs. 430 billion during the first quarter of the year.

During the same quarter, Sri Lanka Customs and the Excise Department of Sri Lanka added nearly Rs. 354 billion and about Rs. 51 billion, respectively. This notable increase in revenue serves as a significant victory for a nation that has grappled with economic challenges, marking a positive milestone on its journey forward. This success can be attributed to effective financial management practices implemented across the country.

Looking at the income trend, there’s reason to anticipate that 2024 could be a year where income targets are achievable. Moreover, the National Consumer Price Index indicates a positive shift: external inflation dropped from 5.1% in February to 2.5% in March, and non-food category inflation plummeted from 5.1% to 0.7% over the same period.

These numbers collectively suggest an improving economic landscape for the country.