Sri Lanka state revenues up 8-pct to March, primary surplus
ECONOMYNET – Sri Lanka’s state revenues had growth 8 percent from a year earlier to 469.1 billion rupees in the first quarter of 2018 from a year earlier, while a primary surplus had been recorded in the budget, official data shows.
But tax revenues grew only 2 percent 425.3 billion rupees up to March 2018, while not-tax revenues doubled to 43.8 billion rupees, helping boost total revenues.
Sri Lanka cut fuel taxes in December 2017, losing a key source of revenue, which has since been corrected. About 5 billion rupees a month extra is expected from market pricing fuel.
Current expenses rose 9 percent to 527.5 billion rupees, keeping pace at 3.6 percent of gross domestic product, giving a revenue deficit of 58.5 billion rupees, up from 48.2 billion rupees a year earlier.
Capital expenditure was 147.7 billion rupees, down 3 percent from a year earlier, giving an overall deficit of 205.8 billion rupees up from 199.7 billion a year earlier.
In terms of estimated gross domestic product, the deficit was slightly narrower at 1.4 percent of down from 1.5 percent a year earlier.
Interest costs rose 6 percent to 220.9 billion rupees. A primary balance of 15.06 billion rupees was recorded up from only 9.37 billion rupees last year.
Net foreign borrowings were a marginally 3.1 billion rupees in the first quarter, up from a negative 2.9 billion rupees last year.
Almost the entire deficit was filled with 202.7 billion rupees of domestic borrowings.
Separate data showed that the central bank had printed 36.3 billion rupees in March, and the rupee came under pressure in April with more money printed to enforce a rate cut.
When money is printed there is a ‘shortage’ of foreign currency and Sri Lanka’s currency peg comes under pressure. (Colombo/June01/2018)