Outstanding domestic tax arrears reach nearly Rs. 2.1 trillion at end of 2025 – IMF report
Executive Intelligence Dispatch
Outstanding domestic tax arrears in Sri Lanka have reached nearly Rs. 2.1 trillion as of the end of 2025, according to a new IMF report.
Key Facts & Findings
- —Total outstanding tax arrears: Rs. 2.1 trillion
- —Defaults subject to appeals or disputes: Rs. 1.6 trillion
- —Outstanding tax arrears in 2024: Rs. 1.1 trillion
“A total of nearly Rs. 2.1 trillion in outstanding tax arrears had been recorded by the Inland Revenue Department (IRD) as of the end of 2025, according to a new report issued by the International Monetary Fund (IMF).”
“Appeals appear to be the largest barrier to collection, and even undisputed tax arrears remain outstanding for extended periods due to staffing constraints and weak prioritization.”
The high level of outstanding tax arrears poses a significant challenge to Sri Lanka's economic recovery and highlights the need for effective tax collection mechanisms.
The IMF recommends introducing a risk-based tax arrears management system to address the issue and improve tax collection efficiency.
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Ada Derana
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Outstanding domestic tax arrears reach nearly Rs. 2.1 trillion at end of 2025 – IMF report
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Reporting: Ada Derana • Synthesis & Multi-Source Indexing: Lanka Dispatch Wire Desk