Budget 2026: Pivot to 7% Growth & Digital Transformation š
ā¢ Macro Targets: Budget 2026 targets aggressive 7% annual economic growth. Fiscal consolidation aims for Debt-to-GDP of 95% and a deficit of 5.2% of GDP by 2026, with state revenue projected at 15.3% of GDP. ā¢ Fiscal & Governance Reforms: Commitment to IMF-backed program continues. Key tax reforms include simplifying the Social Security Contribution Levy (SSCL) on vehicles and replacing the Special Commodity Levy on coconut/palm oil with VAT. E-procurement and digital asset management systems are introduced as structural anti-corruption tools. ā¢ Investment Pillars: Major allocations focus on high-impact sectors: Ā° Digital Leap: Allocation of Rs. 750 Mn for AI Service Centres, a 5-year tax concession for telecom towers, and establishment of a Virtual Economic Zone to boost ICT/BPM. Digital ID issuance is targeted by March 2026. Ā° Infrastructure: Rs. 34.2 Bn for road development (including Expressways) and Rs. 24 Bn for rural roads. Ā° Agriculture: Rs. 91.7 Bn allocated for irrigation infrastructure restoration (e.g., Senanayake Samudraya) to boost primary sector output. ā¢ Social Upliftment: Estate workers' daily wage is increased from Rs. 1,350 to Rs. 1,750 by Jan 2026. A collective Rs. 130 Bn is allocated for public sector salary and pension revisions. Substantial investments are made in health (Rs. 11 Bn for university medical faculties) and education. š