Sri Lanka records Rs. 9.5 billion budget surplus in first half of 2026

Sri Lanka recorded a budget surplus of Rs. 9.5 billion during the first half of 2026, marking a significant recovery from the Rs. 405.6 billion deficit registered during the same period in 2025.

Total government revenue and grants rose by 27.1% year-on-year to reach Rs. 2.95 trillion between January and June, according to the Finance Ministry’s Fiscal Review Report. This performance represents 55.8% of the Rs. 5.3 trillion annual estimate.

Tax revenue expanded by 25.9% to Rs. 2.71 trillion, achieving 55.2% of the full-year target of Rs. 4.9 trillion. Non-tax earnings surged by 43.6% to Rs. 243.6 billion, fulfilling 67.7% of the projected Rs. 360 billion. Conversely, grants dropped by 46.4% to Rs. 1.8 billion, securing just 6% of the Rs. 30 billion target.

Total state expenditure grew by 7.9% to Rs. 2.94 trillion, representing 39.0% of the annual projection of Rs. 7.5 trillion. Recurrent spending increased by 6.5% to Rs. 2.66 trillion against a target of Rs. 5.8 trillion, achieving 45.7%. Capital expenditure and net lending rose by 23.6% to Rs. 276.6 billion, fulfilling 16.1% of the Rs. 1.7 trillion estimate.

The primary balance registered a surplus of Rs. 1.24 trillion, compared to Rs. 859 billion recorded in the corresponding period of 2025.

Sri Lanka Customs led overall collection after generating Rs. 1.29 trillion, achieving 58.5% of its Rs. 2.2 trillion annual estimate.

The Inland Revenue Department collected Rs. 1.24 trillion, meeting 52.0% of its Rs. 2.4 trillion goal, while the Excise Department gathered Rs. 138 billion to reach 56.5% of its Rs. 245 billion projection.

Other revenue streams collected Rs. 35.0 billion, fulfilling 60.1% of the annual Rs. 58 billion target.