<ul><li>·&nbsp; &nbsp; &nbsp; &nbsp; Tax-free threshold raised to Rs 162,500 a month</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 131 b for hospitals; doctors' DAT up to Rs 95,000</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 3 b more for digital schools, VAT off books</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; University academics to get Rs 25,000 more a month</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Digital Economy Authority Bill due in first quarter</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Record Rs 95 b to modernise rail and bus services</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 80 b to begin electrifying three Colombo Rail lines</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 30 b for Kurunegala to Galewela Expressway stretch</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 26.5 b to prevent repeat of national blackouts</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; 200% capital allowance for BOI exporters investing USD 3 m</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 174 b in concessionary loans for MSMEs</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 77 b for irrigation, including Ditwah-hit tanks</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 5 b for Pesalai harbour and Northern anchorages</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 13 b to lift exports to USD 5 b</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Tourism Development Levy scrapped from April</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; 10,000 houses in 2027, grant raised to Rs 1.5 m</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 77 b for drinking water, 13 new schemes</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 230 b for Aswesuma and welfare allowances</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 110 b for final phase of salary hike</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 2,500 interim allowance for 2020 to 2024 retirees</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 9.5 b to digitalise police; Rs 10,000 more allowance</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 5.1 b for courts as prisons hold twice capacity</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Higher tri-forces food allowance, new defence research centre</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 2 b per district for local priorities</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 5 b to double urban waste collection by 2029</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 260 b supplementary estimate for Ditwah rebuild</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Rs 100 m for journalist scholarships and training</li><li>·&nbsp; &nbsp; &nbsp; &nbsp; Deficit to widen to 4.5% of GDP</li></ul>&nbsp;President and Finance Minister Anura Kumara Dissanayake yesterday (12) presented a Budget for 2027 that cuts income tax for a second time and raises allowances across the public service. It also commits a record Rs 2,000 billion to capital spending, while allowing the deficit to widen to fund reconstruction after Cyclone Ditwah.Presenting the Government's third Budget in Parliament, the President said its main objective was "to move from economic stability towards transformation".Under the tax proposals, the monthly income tax-free threshold will rise from Rs 150,000 to Rs 162,500 from April 2027. The rate on the first slab after the 6% band will fall from 18% to 12%, and the 36% top rate will apply only to monthly income above Rs 433,000, up from Rs 358,000. Individual taxpayers will save between Rs 750 and Rs 15,750 a month, at a cost of Rs 16 billion in revenue.Households will see relief at the market sooner. From today, the Special Commodity Levy on imported sprats falls from Rs 100 to Rs 10 a kilogramme and on Maldive fish from Rs 302 to Rs 10. The levy on dried chillies drops by Rs 50. The levy on imported sugar, however, rises by Rs 10 a kilogramme to protect local produceRsBooks, exercise books, dictionaries and children's colouring books will be exempt from Value Added Tax. The Tourism Development Levy will be abolished and CESS rates on 800 import tariff lines will be cut by 25%. Together, the tax measures will cost Rs 21.2 billion in 2027 and Rs 28.4 billion in a full year, according to the Budget annexures.At the same time, the Government is widening the tax net. Capital gains tax will extend to cryptocurrencies, telecommunications licences and high-value gems and jewellery. Income from online advertising and cloud services will be taxed by reference to where payment is made.Public investment is the centrepiece of the Budget. Capital spending of Rs 2,000 billion, equal to 5.12% of GDP, includes Rs 80 billion to begin electrifying the Kelani Valley, Main and Coastal railway lines, a programme expected to cost more than Rs 1,200 billion. A further Rs 30 billion is set aside for the Kurunegala to Galewela section of the Central Expressway and Rs 27 billion for the Ruwanpura Expressway, within Rs 487 billion earmarked for highways, expressways and railways.Public servants also gain. Medical officers' DAT allowance will rise from Rs 70,000 to Rs 95,000, nurses' special duty allowance will double to Rs 12,000 and police officers will receive Rs 10,000 more a month for food and accommodation. University academics, High Court judges and judicial officers will get Rs 25,000 more a month, while prison officers' risk allowance will double to Rs 16,000. Most of these increases will be paid in two halves, from July 2027 and in 2028.Pensioners who retire between 2020 and 2024 will receive an interim allowance of Rs 2,500 a month from July 2027, pending a pension revision under the 2025 salary scale that will begin with the 2028 Budget. Monthly allowances for kidney patients and persons with disabilities will rise from Rs 10,000 to Rs 12,500, and Rs 230 billion has been allocated for social protection, including Aswesuma.The relief comes at a fiscal cost. The Budget estimates put the 2027 deficit at Rs 1,493 billion, or 3.8% of GDP, rising to Rs 1,753 billion, or 4.5%, once a Rs 260 billion supplementary estimate for Ditwah reconstruction is included. That compares with 3.7% in 2026. Revenue is projected at 15.8% of GDP, below the 16% medium-term floor the Government set out in the same speech, and the gross borrowing requirement stands at Rs 3,800 billion.The President said the supplementary estimate was needed because part of the Rs 500 billion approved by Parliament for Ditwah reconstruction had not been used, citing reasons including the war in the Middle East.With the International Monetary Fund's Extended Fund Facility due to end in March, the Cabinet has appointed a committee headed by the Deputy Minister of Finance and Planning to report on whether Sri Lanka should enter another programme, and of what type.The speech closed on a combative note. The President accused the Opposition of "clinging to superstitious beliefs" and said politics should be done among the people, "not by tying threads in cemeteries at night, nor by wasting the time of Parliament reciting curse verses".Moments later, he invited all political parties to become partners in building the country. "Our country is greater than our differences," he said.Parliament will now debate the Appropriation Bill.&nbsp;

Budget 2027: Govt bets on Rs 2t capital spend

<ul><li>Cites Rs 528b losses between 2008-2025</li></ul> President Anura Kumara Dissanayake, in his Budget speech, questioned whether the Treasury can continue to shoulder the financial burden of the SriLankan Airlines, disclosing that the national carrier has accumulated losses of Rs 528 billion between 2008 and last year (2025).Presenting the 2027 Budget in Parliament yesterday (12), he described the losses as the consequence of what he termed an arrogant decision by a former ruler, placing the Airline's financial position among the challenges facing the Government as it seeks to strengthen public finances and reform State-owned enterprises (SOEs).&nbsp;The President said that an expert committee had been appointed to examine the issues facing the national carrier and identify an appropriate way forward.&nbsp;The disclosure comes against the backdrop of the Government's claim that it has improved the overall financial performance of major SOEs. According to the President, 52 major SOEs recorded a combined loss of Rs 774.6 billion in 2022 but moved to a combined profit of Rs 444.4 billion in 2025. He further said that these enterprises had recorded a combined profit before tax of Rs 367 billion by the end of August.&nbsp;

President asks: ‘Should the Treasury shoulder SriLankan?’

<ul><li>Sajith alleges Govt. concealing economic data&nbsp;</li><li>SLPP queries tax relief on essentials&nbsp;</li><li>Sarvajana Balaya claims it’s an IMF, WB Budget&nbsp;</li><li>UNP claims Millennial, Gen Z issues unaddressed&nbsp;&nbsp;</li></ul> Opposition and Samagi Jana Balawegaya (SJB) Leader Sajith Premadasa accused the Government of concealing accurate data on the country's economic situation and producing figures to justify the policies it intends to implement through next year's (2027) Budget.Addressing a pre-Budget workshop yesterday (12), he said the Government had failed to honour its Presidential Election mandate, claiming that the 74% of votes cast for President Anura Kumara Dissanayake and the SJB candidate reflected public support for a new International Monetary Fund (IMF) agreement."Both the National People's Power (NPP) and the SJB said during the Election campaign that we would move towards a new agreement with the IMF. But, after coming to power, the NPP kicked aside that mandate," he said.Premadasa claimed that the Government had gone beyond the previous administration's "neo-liberal" policies, placing a heavier burden on working people. He also criticised the debt restructuring handled by Lazard, claiming that the macro-linked bond meant that debt repayments would increase alongside economic growth. He said IMF representatives had recently met the Opposition and indicated the need for a responsive agreement.He further accused the Government of imposing taxes beyond IMF targets, citing an increase in the primary surplus from 2.3% to 5.4% and revenue as a share of gross domestic product from 13.9% to 15.4%.Questioning the Government's poverty measure of around Rs 17,000 a month, based on a daily intake of 2,030 kilocalories, he claimed that World Bank data showed nearly 60% of the population was poor. He also questioned the selection of Aswesuma beneficiaries and called for a revised Janasaviya programme to eradicate poverty.Premadasa proposed a new development bank for young people and micro-, small- and medium-scale enterprises (MSMEs), noting that around 250,000 MSMEs had closed during the 2022 economic crisis. He also listed unfulfilled Government pledges, including a 33% electricity tariff reduction, fuel at port-unloading prices, 1.2 million Vitz cars, 50,000 motorcycles and the removal of Value Added Tax on school equipment.Meanwhile, the website oversight.lk was launched yesterday on Premadasa's instructions to monitor the Government's performance against its Budget commitments.Sri Lanka Podujana Peramuna (SLPP) General Secretary Sagara Kariyawasam dismissed the 2027 Budget, saying there was little point in discussing it given the Government's alleged failure to deliver on its previous two Budgets. He said the public had expected meaningful tax relief on essentials, including food, electricity and fuel. "Whatever concessions were given have gone to the wealthiest people at the very top," he said.Sarvajana Balaya Operation Head Madhura Vithanage said the Budget should be assessed against the promises made in the 2025 and 2026 Budgets and the extent to which they had been implemented. He said the country needed programmes to generate wealth domestically, but claimed the Government had largely followed IMF and World Bank recommendations. "There was no other qualitative or positive programme," he said.Citing capital expenditure, Vithanage said only 30% of the allocation for 2026 had been spent by September. He also questioned the reappearance of previously announced proposals, including tank construction, dispensaries and a Central Highlands Authority.Referring to President Dissanayake's statements about building 50 universities, establishing 1,000 Fourth Generation signal towers and constructing 450 tanks within two months, he questioned the absence of corresponding Budget allocations. He further criticised the lack of measures to prepare young people for entrepreneurship, address the employment impact of artificial intelligence (AI) and stem the brain drain."The impact of AI on jobs could become particularly serious by around 2028, but the Budget has failed to address the issue. This Budget has no connection to reality. In fact, it can't even be called a Budget. It is just another extension of the usual lies told on political stages," he said.United National Party (UNP) Chairperson Wajira Abeywardana also criticised the Budget, claiming it offered no strong solutions to pressing national issues, particularly those affecting Millennials and Generation Z. He said Sri Lanka was lagging behind a rapidly advancing world in modern technology and that the proposals lacked mechanisms to generate employment for younger people through technological development.Abeywardana said foreign reserves should be increased to US$ 13 billion and questioned whether the Budget provided sufficient relief on essential commodities, diesel, gas and electricity. He also identified the absence of a clear provision to meet approximately US$ 3.5-4 billion in repayments to international creditors by 2028 as a major shortcoming.

Opposition questions delivery, priorities 

<ul><li>FUTA disgruntled by lack of facility constructions&nbsp;</li></ul>The Ceylon Teachers’ Union (CTU) has criticised the 2027 Budget for failing to introduce a dedicated programme to develop small rural schools, warning that the proposed education reforms cannot be effectively implemented without addressing existing infrastructure and resource shortages.Speaking to The Daily Morning, CTU President Priyantha Fernando said successive Governments had introduced targeted programmes to develop small rural schools, but no similar allocations had been made in the latest Budget.He questioned the practicality of introducing reforms without first preparing classrooms and other facilities to support them.“ The new reforms for Grade One students have already been introduced, while reforms for Grades Two to Six will begin in 2027. Yet, these students are still in the same old classrooms, which aren’t ready for this transformation. Obviously, we need reforms, but classrooms must first be equipped to facilitate them,” he said.Fernando noted that although the Government planned to establish 300 smart classrooms in 2027, more than 10,000 classrooms catered to students from Grades One to Six. He said education development required comprehensive programmes to address infrastructure and resource shortages rather than isolated projects.He also highlighted the teacher shortage, saying there were around 46,000 vacancies, which were expected to rise to 56,000 next year. The proposed recruitment of 23,000 teachers in 2027 would therefore be insufficient.The Budget has allocated Rs. 35,000 million for digitalisation, teacher capacity development and school infrastructure. However, Fernando questioned whether the funds would be utilised, noting that around 65% of allocations made in 2025 had remained unspent, while only around 30% of the 2026 allocations had been spent so far.Meanwhile, Federation of University Teachers’ Associations (FUTA) Secretary Prof. Anura Wanninayaka said the Budget had failed to adequately address infrastructure and facilities in the university system.He said allocations appeared insufficient, with the Government prioritising assessments and planning in 2027 instead of proceeding with construction. The Budget has allocated Rs. 2,250 million for assessment studies and planning for identified university projects, including study buildings and laboratories, with construction expected to begin in 2028.Prof. Wanninayaka said delaying action by another year was problematic, particularly as university academics were already leaving the country. He also said the increased Value Added Tax concession limit for university academics remained inadequate given the prevailing cost of living.

Small rural schools infrastructure ignored: CTU

Farmers have expressed disappointment with the 2027 Budget, saying it has failed to provide adequate support to improve agricultural infrastructure and strengthen the sector’s contribution to national production, despite this being a requirement identified by the International Monetary Fund (IMF).Speaking to The Daily Morning, National Agrarian Unity President Anuradha Tennakoon said that although Rs 2,000 million had been allocated for small irrigation systems and tanks under the Agrarian Development Department and Rs 7,700 million for the Irrigation Department, at least 30% of similar allocations in the previous Budget had remained unspent.He said farmers had also expected the promised railway service to transport vegetables and fruits, as announced by President Anura Kumara Dissanayake in 2026, along with other proposals to reduce production costs. The President’s earlier pledge to develop Thambuththegama Railway Station as an agricultural transport hub had also yet to materialise, he added.Meanwhile, National Tea Planters’ Association President Saman Geeganage said that while the Budget provided for a tea fertiliser subsidy, the priority was to ensure that assistance reached growers without cumbersome procedures.He said previous subsidies had involved lengthy processes, including meetings and other requirements, while the State offices responsible for distribution were inefficient. With labour shortages and demanding cultivation work, growers could not afford to spend time away from their plantations to secure the subsidy. He said improving the distribution mechanism was more important than increasing allocations.Meanwhile, the Government has introduced a Rs 500 million loan scheme at 5% annual interest for fishermen seeking to import multi-day vessels, each costing around Rs 400 million. President Dissanayake expects six to seven vessels to be added to the local fleet.However, All Island Multi-day Fishing Vessel Owners’ Association President Tyronne Mendis said the industry's main problems were fuel and the costs of handling, processing, storing and transporting fish.He said tuna had to be cleaned and packed in ice within an hour of being caught, requiring equipment and supplies to be carried to sea. Combined with fuel costs, expenses had risen from Rs 2.5 million to Rs 7.5 million, leaving most vessels operating at a loss and prompting owners to leave the industry.While welcoming the loan scheme for those seeking to buy vessels, Mendis said a fuel subsidy was the industry's main requirement.

Farmers, fishermen query lack of subsidies  

Commenting on Budget proposals, the All Island Three-Wheeler Drivers’ Association said that despite repeated requests to the Government to reduce the initial payment required to purchase a three-wheeler, currently set at 70% of its full price, no allocations had been made to address the issue.Speaking to The Daily Morning, Association President Lalith Dharmasekara said he was generally satisfied with the Budget proposals for the transport sector but questioned whether they would be effectively implemented.Meanwhile, when contacted, Lanka Private Bus Owners’ Association President Gemunu Wijeratne said that no allocations had been made to reduce taxes on imported buses for the private sector, which was the only request the Association had made so far.

Transport sector notes lack of import relief  

The Electricity Consumers’ Association (ECA) stated that Budget 2027 had failed to provide sufficient tax relief for the renewable energy sector, warning that Sri Lanka could struggle to meet its target of generating 70 per cent of its electricity from renewable sources by 2030 unless taxes on renewable energy equipment are removed completely.Speaking to The Daily Morning, the ECA General Secretary Sanjeewa Dhammika said that partial tax concessions would do little to encourage the expansion of renewable energy. “There is no point in giving a 10% or 20% concession. If we are serious about reaching the 70% renewable energy target by 2030, these taxes must be removed completely,” he said.He said that the Government would not suffer a financial loss by giving up the tax revenue collected from renewable energy equipment, as the greater use of renewable energy would help the country reduce its dependence on imported fuel and save foreign exchange in the long run. “The State will not suffer a loss by forgoing these taxes. In the long run, it will help the country save Dollars.”Dhammika further said that consumers currently pay taxes amounting to 22.5% on solar panels, 24.5% on inverters and 24.5% on solar batteries. Taxes on surge protection devices stand at 57.5%, cables at 52.5% and polyvinyl chloride accessories at 22.5%.Dhammika also criticised the overall direction of the Budget, saying that the Government had missed an opportunity to provide relief to the wider public. “Even though there was an opportunity to provide relief to the entire population, this Budget has been designed to grant massive tax concessions only to large-scale businesses, while placing a heavy tax burden on ordinary people and middle-class salary earners. That is utterly deplorable,” he said.

Electricity consumers bemoan renewable relief 

The Joint Council of Professions Supplementary to Medicine (JCPSM) has expressed disappointment over the failure of the 2027 Budget to address long-standing allowance grievances of health professionals.Speaking to The Daily Morning, JCPSM Secretary Chanaka Dharmawickrema said the Budget had failed to address payments for extra duty and work on public holidays, while changes to existing rates had further disadvantaged members.He said health professionals had previously received extra-duty and public-holiday payments calculated at one-20th of their basic salary, under a system introduced in 1978. However, the rate had been reduced to one-30th under the present Government, while the hourly overtime calculation had also been changed from one-160th to one-200th of the basic salary.The JCPSM had sought an improved overtime rate in line with that received by doctors, whose rate had previously been one-80th of their basic salary. “Instead, the rate applicable to our members, which was already lower, has been further reduced,” he said.Dharmawickrema said these issues were particularly concerning given staff shortages and the growing demands on the health service, with supplementary medical professionals required to work weekends, public holidays and round-the-clock shifts, including on-call duties.He also questioned the failure to increase their special duty allowance, noting that doctors’ Disturbance, Availability and Transport (DAT) allowance had been raised to Rs. 95,000, while supplementary medical professionals had received no comparable revision. He said doctors’ allowance had previously been increased from Rs. 35,000 to Rs. 75,000, while the corresponding allowance for supplementary medical professionals had risen by only Rs. 3,000. Outstanding arrears of Rs. 10,500 also remained unpaid, he added.However, he welcomed allocations for laboratory services, including scanning, cath lab and MRI equipment, and the proposed transfer of certain Northern and Southern provincial hospitals under the Central Government.Meanwhile, the Government Medical Officers’ Association (GMOA) said it was too early to assess the Budget without examining its contents in detail. A representative said the assessment would consider progress in recruitment, human resources, health funding, infrastructure, medicines and equipment, as well as actual utilisation of previous allocations.The representative said proposals had to be assessed on their implementation rather than their inclusion in the Budget.

Health sector on Budget: Extra duty, public holiday, OT pay issues raised 

&nbsp;<ul><li>Four&nbsp; amendments ordered for the same&nbsp;</li></ul> The Supreme Court (SC) has determined that the Bill for the Protection of the State from Terrorism Act (PSTA) can be passed by a simple majority in Parliament, subject to four amendments being incorporated at the Committee Stage.Speaker of Parliament Dr Jagath Wickramaratne informed Parliament that he had received the SC’s Determination on the Bill, which was challenged under Article 121(1) of the Constitution. According to the Determination, four amendments must be made to the Bill at the Committee Stage to enable its passage by a simple majority.&nbsp;The Speaker noted that three of the proposed amendments had already been undertaken by the Solicitor General. The amendments include revising Clause 26(2) to require an application by the Police officer conducting the investigation before a Magistrate may authorise the further detention of a suspect in Police custody for a period not exceeding 24 hours.&nbsp;The Court has also proposed amending Clause 59(5)(b) by replacing the reference to the “Court of Appeal” with the “SC” to ensure effective judicial oversight. Furthermore, the SC has recommended removing Clause 60(7) on the grounds that it is superfluous. The fourth amendment requires Clause 66(1) to be reworded to provide that an Executive order, directive or direction issued or made under the Act may be challenged through proceedings under Articles 126, 140 or 141.&nbsp;The Speaker further ordered that the full Determination be included in the official report of Parliament’s proceedings.

Budget 2027: Govt bets on Rs 2t capital spend

President asks: ‘Should the Treasury shoulder SriLankan?’

President asks: ‘Should the Tr ...

Opposition questions delivery, priorities

Opposition questions delivery, ...

Small rural schools infrastructure ignored: CTU

Small rural schools infrastruc ...

Farmers, fishermen query lack of subsidies

Farmers, fishermen query lack ...

Transport sector notes lack of import relief

Transport sector notes lack of ...

Electricity consumers bemoan renewable relief

Electricity consumers bemoan r ...

Health sector on Budget: Extra duty, public holiday, OT pay issues rai ...

Health sector on Budget: Extra ...

SC determines: Simple majority will suffice for PSTA

SC determines: Simple majority ...

President asks: ‘Should the Treasury shoulder SriLankan?’

President asks: ‘Should the Tr ...

Opposition questions delivery, priorities

Opposition questions delivery, ...

Small rural schools infrastructure ignored: CTU

Small rural schools infrastruc ...

Farmers, fishermen query lack of subsidies

Farmers, fishermen query lack ...

Transport sector notes lack of import relief

Transport sector notes lack of ...

Electricity consumers bemoan renewable relief

Electricity consumers bemoan r ...

Health sector on Budget: Extra duty, public holiday, OT pay issues rai ...

Health sector on Budget: Extra ...

SC determines: Simple majority will suffice for PSTA

SC determines: Simple majority ...

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President asks: ‘Should the Treasury shoulder SriLankan?’

President asks: ‘Should the Tr ...

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Opposition questions delivery, ...

Bringing the news paper to your fingertips

Small rural schools infrastructure ignored: CTU

Small rural schools infrastruc ...

Farmers, fishermen query lack of subsidies

Farmers, fishermen query lack ...

Transport sector notes lack of import relief

Transport sector notes lack of ...

Electricity consumers bemoan renewable relief

Electricity consumers bemoan r ...