Will reducing the VAT threshold to Rs 36 million lead to an increase in prices and inflation?
- Rehana Thowfeek
- Dec 3, 2025
- 1 min read
Updated: Jan 16
Understand how Sri Lanka’s revised VAT threshold could impact prices, inflation, and small businesses. This publication breaks down the economic reasoning, past data, and global evidence to help you make sense of the policy change.
Published by: Arutha
Prepared by: Rehana Thowfeek, Director – Arutha with assistance from Shaheen Abdul Gani, Research Assistant – Arutha
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Will a reduced VAT threshold boost inflation?
by Rehana Thowfeek
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