Treasury overflows: rupees earned, dollars spent, time to rationalise vehicle imports

In his 2026 Budget Speech, President Anura Kumara Dissanayake painted an optimistic picture of the economy, citing the steady recovery of state revenue and the restoration of macroeconomic stability. Yet, he did so with a cautious approach.

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He highlighted that govemment revenue would be 16 per cent of the GDP (Gross Domestic Product), thanks to improved tax collection and a broadening of the revenue base. Tax revenue from vehicle imports contributed to the state coffers.

Vehicle imports, once a major source of customs revenue, were suspended in 2020 amid the balanceof-payments crisis. At the time, the measure was unavoidable. With foreign reserves plummeting to less than US$1 billion in 2022 and international credit lines drying up, curtailing non-essential imports was a survival strategy for the then-rulers.

Now, the situation has improved. The Central Bank reported that gross official reserves stood above US$6 billion at the end of June 2025, supported by inflows from multilateral agencies, remittances, and the phased restructuring of external debt. According to the President, the letters of credit had been opened for vehicle imports valued at US$1.9 billion by September 30, 2025. Besides, US$1.3 billion had already been spent by that time for vehicle imports.