In the face of an adverse economic crisis in Sri Lanka, Finance Minister Ali Sabry raised concerns over the declining liquid reserves in the island country which have currently plunged below USD 50 million.
Addressing the Parliament of Sri Lanka, Sabry stated that if the economic crisis is not curbed, it could pose a serious threat to the country, reported the Colombo Page. According to the Finance Minister, the decision to reduce the tax rates was a grave mistake.
The Finance Minister even agreed that Sri Lanka should have approached the International Monetary Fund sooner and the rupee should have been properly depreciated.
"All governments acted on a dependency mentality. This is the result of debt burden for a long time. Wrong policies in our time also helped to create this situation," said Sabry, as reported by the Colombo Page.
The Finance Minister urged the parliament that income tax rates must be increased in the future. A new budget will also be presented. He also asked working individuals to share a part of their earnings.
"People who earn must share some money, or society will collapse. Tax revenue will have to increase by about 15 percent over the next two to three years," Sabry said.
Further, the Finance Minister stated that the progress report of the International Monetary Fund negotiations has been distributed to all Members of Parliament, as reported by the Colombo Page.
Meanwhile, Sri Lanka's economy has been in a free fall since the COVID-19 pandemic due to the crash of the tourism sector. The country is presently facing a foreign exchange shortage which has led to a food, fuel, power, and gas shortage, and has sought the assistance of friendly countries for economic assistance.
In addition, Sri Lanka is also witnessing at least 10-hour daily power cuts. Its's currency has been devalued by almost SLR 90 against the US dollar since March 8. (ANI)