Public Finance Data and Analysis
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The recently released CBSL Economic review shows that in 2024, government expenditure totalled LKR 6,131 billion. Nearly half—LKR 2,690 billion, or 44 percent—went on interest payments for existing debt. Day-to-day costs consumed much of the rest: salaries and wages amounted to LKR 1,066 billion, while pensions and welfare transfers absorbed LKR 1,234 billion. Only LKR 791 billion was spent on capital investment, illustrating how debt service continues to stifle development spending.
Revenue reached LKR 4,091 billion, covering roughly two-thirds of total spending. Consumption taxes bore the brunt of collection: VAT and excise duties generated LKR 2,181 billion—more than half of all revenue. Income taxes contributed LKR 1,026 billion.
Despite this, the Treasury posted a LKR 2,041 billion deficit, borrowing to fund a third of its budget.
In short, debt service is largely consuming the expenditure, consumption taxes are carrying revenue, and borrowing remains essential to balance the books.
Source
Central Bank of Sri Lanka Annual Economic Review 2024 at https://www.cbsl.gov.lk/en/publications/economic-and-financial-reports/annual-economic-review/annual-economic-review-2024 [last accessed 5 May 2025].
