The Government of Sri Lanka is projected to collect Rs. 56 billion in 2027, through the imposition of a long awaited property tax, key to its agreement with the International Monetary Fund, its latest staff report shows.

The Government is projected to collect Rs. 56 billion in 2027 through the property tax while the projected revenue through the property tax in 2028 is Rs. 122 billion.

The initiative forms part of the government’s broader revenue mobilisation strategy, and is expected to enhance tax equity and improve public sector financing.

According to the undertaking given to the IMF, the government is continuing to build the data infrastructure to facilitate the introduction of the property tax.

In a letter of intent addressed to IMF Managing Director Kristalina Georgieva, President Anura Kumara Dissanayake as the Minister of Finance, Planning, and Economic Development has stated that the government is fully committed to the economic reform programme supported by the extended fund facility (EFF).

The letter states, going forward, the government remains committed to the programme objectives of (i) revenue-based fiscal consolidation, fiscal structural reforms including cost-recovery energy pricing, supported by enhanced social safety nets to protect the most vulnerable, (ii) implementing the debt restructuring strategy to preserve public debt sustainability, (iii) safeguarding price stability and rebuilding international reserves under continued exchange rate flexibility, (iv) preserving financial system stability; (v) sustaining governance and anti-corruption reforms, and (vi) implementing broader structural reforms to unlock Sri Lanka’s growth potential.