📊 Pres. Dissanayake Hints at Tax Relief & Wage Hikes Ahead of 2027 Budget

• Key Relief Measures: • Proposed further increase to the Pay As You Earn (PAYE) tax threshold (previously raised from Rs. 100,000 to Rs. 150,000). • Staged reduction in Value Added Tax (VAT) over the next 2-3 years, alongside tax removal on essential educational materials. • Deferral of the IMF-proposed property tax on housing for another year. • Public & Private Sector Wages: • A three-stage public sector basic salary increase projected to cost Rs. 330 Bn by 2027. • Ongoing engagements with the private sector on basic salaries and supplementary allowances. • Sector & Project Allocations: • Grassroots Infrastructure: Rs. 2 Bn set aside for grassroots capital expenditure. • ICT & Telecom: Funding for 750 communication towers next year (target: 1,000 in 3 years). • Education & Transport: Allocation for Grade 6 education reforms and an electric train project. • Fiscal Boundaries: • Revenue targets locked at >15.3% of GDP (2026) and >15.4% (2027) under IMF parameters, with a primary expenditure ceiling of 12.9% of GDP. IMF program concludes in March 2027, ahead of stepped-up debt service in 2028.