Overview of Budget 2026
Sri Lanka is set to unveil its 80th budget since independence today, at 1:30 pm. This will be the second budget under the New National Party (NPP) government and will be presented by President Anura Kumara Dissanayake in his capacity as Finance, Planning and Economic Development Minister. The theme for this year’s budget is “A Productive Economy and Foster the Engagement of Everyone in Economic Development.” The budget has been prepared in alignment with the 2026-2030 Fiscal Framework, the Fiscal Strategy Statement, and the National Policy Framework titled “A Thriving Nation – A Beautiful Life.”
The focus of the 2026 Budget is on prioritizing the goals outlined in the National Policy Framework and rural development initiatives. All ministries are expected to submit proposals that align with the Public Finance Management Act, No. 44 of 2024, and the Government Policy Statement.
Key Priorities and Initiatives
During the NPP government’s first budget in February 2025, the President introduced a three-year plan to increase public servants’ salaries. The first phase of this initiative was implemented this year with an allocation of Rs.110,000 million. Building on this, the 2026 budget includes more funds to implement the second phase of salary increases for the private sector and pensioners, as well as to digitalize government services and develop infrastructure in rural, semi-urban, and urban areas.
It is reported that over 100 government expenditure proposals will be included in the 2026 budget, aimed at driving comprehensive development across the country. These proposals will be implemented through various ministries and departments.
Economic Goals and Strategies
Budget 2026 aims to achieve continuous economic growth exceeding four percent annually. It also seeks to attract foreign direct investment rather than relying on foreign loans, control inflation, and strengthen the rupee. The government has set socio-economic development and maintaining law and order as key objectives, alongside enhancing investments and increasing export earnings.
Labour Minister and Finance and Planning Deputy Minister Dr. Anil Jayantha Fernando highlighted that the 2026 budget will include proposals to equally develop both the countryside and the city, with a strong emphasis on public participation. He noted that the government is allocating state capital expenditure rapidly to programs focused on people’s welfare and development. Additionally, there will be more space provided for state expenditure proposals to be used effectively and efficiently.
Infrastructure and Development Focus
More funds will be allocated for village-level roads, highways, water supply, electricity, housing, public infrastructure, religious activities, arts, sports, entertainment, national unity, and coexistence. High incentives will be offered for new products and innovations to help expand into the export market. Youth entrepreneurship will also be encouraged.
To support struggling businesses, relief measures will be introduced. Instead of introducing new taxes, the government will focus on changing taxpayer attitudes to encourage voluntary tax payments. The minister emphasized that expanding the tax net will be done in a way that instills a sense of national responsibility among citizens.
International Collaboration and Future Targets
The government is already working to meet its revenue targets and has focused on achieving economic goals by 2026, 2027, and 2028. It hopes to further collaborate with international financial institutions such as the World Bank, the International Monetary Fund, and the Asian Development Bank.