- Steps taken to widen tax base and improve tax compliance
- Tax Identification Number (TIN) essential for obtaining services
The Inland Revenue Department (IRD) is confident of achieving the revenue target for 2025 having widened the tax base and improved tax compliance in the country said a top official of the country’s main tax authority.
“We are on path to reach the revenue goals set for the current year,” said Commissioner IRD Nandana Kumara. The chief tax collection institution targets Rs. 2,195 billion in tax revenue from the state this year.
In 2024, the IRD collected a record Rs. 1,958 billion in tax revenue, exceeding the previous year’s collection by 25.1%. While this represents a significant increase, it fell short of the initial target of Rs. 2,024 billion.
The primary drivers of this record collection were income tax and Value Added Tax (VAT).
“We are reaching the revenue target this year as the tax base has been widened and compliance has been improved vastly,” the Commissioner said, adding that the IRD has already increased the number of individual tax payers to around one million from 800,000 last year.
“It is the responsibility of every citizen liable to pay taxes to contribute to the development of the country. If tax payers take their duty seriously it is then that the Government will have funds to invest on services. So those who question what do they get in return for paying taxes must ask how could the state provide services without capital,” the Commissioner said.
He said many people pay taxes but the amount is enough only to meet the state’s recurrent expenditure. If everyone fulfils their responsibility as citizens then there would be sufficient money for capital investments.
The approved budget estimates for 2025 projects Government Revenue to increase to Rs. 5,012 billion which includes non-tax revenue but excludes provincial revenue and grants. The figure marks an increase of Rs. 922 billion — or 23 percent — compared to Rs. 4,090 billion in 2024.
The Commissioner said Revenue Administration Management Information System (RAMIS) has helped cut lot of unnecessary expenditure and reduced paper work while enhancing efficiency in revenue administration.
The system facilitates filing of corporate and individual returns through e-services.
“Obtaining a Tax Identification Number (TIN) is essential to open new bank accounts, register lands, motor vehicles and approve building plans. All information about taxpayers are linked to all major institutions such as banks, RMV, and the land registry to name a few,” he said.
The Inland Revenue Department of Sri Lanka along with the Ministry of Finance commenced the Project for implementing the Revenue Administration Management Information System (RAMIS) to provide a better service to the nation and taxpayers.
