Sri Lanka recorded a budget surplus of Rs. 197.3 billion in the first five months of 2026, a sharp reversal from a deficit of Rs. 236.6 billion in the same period a year earlier, according to Central Bank of Sri Lanka data.
The turnaround was driven by strong revenue growth. Total revenue and grants rose 30.6% year-on-year to Rs. 2.54 trillion, up from Rs. 1.94 trillion in the January–May period of 2025. Tax revenue increased 23.9% to Rs. 2.32 trillion, while non-tax revenue surged 54.2% to Rs. 211.84 billion.
The primary balance — a key fiscal anchor under Sri Lanka’s International Monetary Fund-backed reform programme — improved to a surplus of Rs. 1.13 trillion, a 52.3% increase from Rs. 742.92 billion a year earlier.
Government expenditure grew a more modest 7.3%, though capital spending rose 29.3%, pointing to a gradual recovery in public investment alongside tighter overall fiscal management.
The figures underline the continued strengthening of public finances as the government — with President Anura Kumara Dissanayake also serving as Finance Minister — seeks to consolidate the recovery from the 2022 economic crisis and stay on track with IMF programme targets. Officials have credited improved tax administration and stronger remittance and industrial activity for the revenue gains.
