Sri Lanka has launched a new round of austerity measures, banning government hiring as new taxes and higher electricity rates took effect as the country's leaders sought an IMF bailout.
The measures were taken in consideration to achieve debt sustainability.
The IMF has also asked Colombo to trim its 1.5 million strong public service, sharply raise taxes and sell off loss-making state enterprises. Hence doubled personal income and corporate taxes kicked in on New Year’s Day to shore up state revenue, while electricity prices went up 65 percent after a 75 percent tariff increase in August.
Meanwhile, a record 20,000 civil servants retired at the end of December — eight times as many as usual according to the public administration ministry — after President Ranil Wickremesinghe reduced their retirement age from 65 to 60. They will not be replaced, the ministry said.
The measures were taken in consideration to achieve debt sustainability.
The IMF has also asked Colombo to trim its 1.5 million strong public service, sharply raise taxes and sell off loss-making state enterprises. Hence doubled personal income and corporate taxes kicked in on New Year’s Day to shore up state revenue, while electricity prices went up 65 percent after a 75 percent tariff increase in August.
Meanwhile, a record 20,000 civil servants retired at the end of December — eight times as many as usual according to the public administration ministry — after President Ranil Wickremesinghe reduced their retirement age from 65 to 60. They will not be replaced, the ministry said.
