Human Rights Watch has highlighted in its latest report that long-standing tax policy failures have been a major factor in Sri Lanka’s current economic collapse. .
The report points out that this has violated citizens’ fundamental rights, especially the right to education, and that the country’s long-standing inadequate taxation, excessive corporate tax breaks, and weak enforcement of tax laws have deprived the government of the revenue it needs to maintain essential services such as health, education, and social security.
Human Rights Watch has highlighted serious weaknesses in Sri Lanka’s tax policy, saying the tax-to-GDP ratio in 2023 was 7.3%, one of the lowest in the world. This has contributed to the country’s economy being plunged into a prolonged crisis.
HRW further warns that Sri Lanka’s tax system is “inadequate and regressive.”