Loss suffered by country due to pandemic Rs.1,600 billion so far this year

By Saman Indrajith

Finance Minister Basil Rajapaksa told Parliament yesterday that the country had suffered a revenue loss of Rs 1,600 billion due to the COVID-19 pandemic so far in the year.

Participating in the debate on regulations imposed under the Financial Bill and Export Import Control Bill, the Minister said that revenue from the Inland Revenue Department, Customs and Excise Department had gone down drastically owing to the lockdown.

 He said the government had also lost revenue from the Customs Department due to the suspension of vehicle imports for more than one and half years. The decision to suspend vehicle importation had been made to save foreign exchange.

 Minister Rajapaksa said that the VAT revenue that should have been added by the Inland Revenue Department had decreased by around 75 per cent.

 The Minister said that there had been a decrease in foreign loans too and added that Sri Lanka had to purchase around 80 percent of COVID-19 vaccines on ready cash.

“Total revenue has dropped drastically compared to expenditure.

This is not totally due to the pandemic as Sri Lanka’s state expenditure has exceeded the revenue for centuries,” he said.

“We have decided to use foreign assistance with utmost diligence and will only work with institutions such as the World Bank and Asian Development Bank and will only go for concessionary loan schemes. Sri Lanka will not agree to political conditions any donor would impose when it comes to external borrowings,” the Minister said.

He said that the amount of foreign reserves too had decreased, and the government had commenced producing some medicine in the country to prevent the drain of foreign reserves and started producing the country’s saline requirement on Sept 1.