Sri Lanka Establishes Tax Policy Analysis Unit (TPAU) 📈

The Ministry of Finance has formally established the Tax Policy Analysis Unit (TPAU) under the Department of Fiscal Policy to strengthen evidence-based fiscal reforms and revenue management. • Core Functions The unit is tasked with comprehensive revenue analysis, evaluating tax expenditures, and conducting distributional analysis of tax policies. It will also provide critical support for international taxation and regional tax cooperation. • Strategic Objectives • Support the design, appraisal, and monitoring of national tax reforms. • Utilize internationally accepted methodologies for data-driven policy making. • Engage with key stakeholders to ensure transparent and effective tax administration. • IMF Collaboration Marking its operational launch, the unit completed a foundational capacity-building programme conducted by the International Monetary Fund (IMF) from January 19–30, 2026. Discussions with the Treasury Secretary and Director General of Fiscal Policy focused on integrating the unit into the broader national reform agenda. • Context The establishment of the TPAU is a key component of Sri Lanka’s structural reform commitments, aimed at enhancing fiscal discipline and ensuring long-term debt sustainability through modernized tax frameworks.