📈 Strategy Proposed to Transform Sri Lanka into a Retail Tourism Hub

A new strategic proposal (3.0) aims to position Sri Lanka as a leading regional retail destination by tripling daily tourist spend and optimizing government revenue through targeted reforms. • Economic Context & Targets Retail tourism contributed 12.8% to GDP (2010-2019), significantly outperforming the national GDP growth of 4.9%. Goal: Increase average daily tourist spend from <US$ 200 to US$ 600. Objective: Scale retail tourism into a US$ 1 Bn industry to help reach the US$ 8 Bn total tourism earnings target by 2030. • Key Strategies Tariff Rationalization: Reduce import duties on high-demand luxury items including luxury watches, electronics, branded fashion, and gems & jewellery to improve regional competitiveness. Digital VAT Refunds: Implement a seamless, automated VAT refund system (similar to Singapore’s eTRS) within 12-18 months. Strategic Partnerships: Collaborate with global operators like Global Blue or Planet Tax Free to simplify the refund process for high-value goods like tea and handicrafts. • Expected Outcomes Economic Diversification: Growth in local textile, handicraft, and jewellery sectors. Revenue Growth: Higher sales volumes via competitive pricing are expected to offset lower tax rates, resulting in a net positive impact on the treasury.