Why Sri Lanka’s three-wheeler industry deserves credit for reducing poverty?

Walk through any Sri Lankan town and you'll hear it before you see it—the familiar hum of the three-wheeler, or “tuk-tuk,” weaving through traffic, carrying workers, schoolchildren and market goods.

- BY SAMPATH PERERA

To some, it’s a noisy nuisance. But to millions of Sri Lankans, that sound is the rhythm of economic survival. The three-wheeler is not merely a transport option; it is one of the country’s most effective poverty-eradication tools—an informal social safety net on wheels that has done more for income generation, employment and mobility than many government programmes combined.

There are around 945,000 active three-wheelers on Sri Lanka’s roads today. Nearly half operate as taxis, while the rest serve personal or mixed income-generating purposes—delivering goods, providing school transport or supporting small tourism ventures. This single industry sustains 3.5 million people or roughly one in six Sri Lankans, when dependents and support sectors are included.

For countless low-income households, the three-wheeler is not just a vehicle—it’s an enterprise, a microbusiness and often a family’s sole productive asset. It allows individuals with minimal formal education or capital to earn independently, in an economy where secure jobs are scarce and underemployment widespread.

A driver can earn around Rs.6,000 per day after expenses, a figure that dwarfs the minimum government wage of Rs.2,750 and far exceeds the national poverty line of Rs.800 per day. For many, the tuk-tuk represents the difference between insecurity and stability. It’s a democratised form of entrepreneurship—low-barrier, flexible and income-generating from day one.

The Fiscal Paradox

Despite being the vehicle of the working poor, the three-wheeler is also a major taxpayer. Government revenue from this sector is disproportionately high: taxes amount to roughly 130—170% of the vehicle’s import value (CIF). Few other industries, particularly those serving low-income consumers, contribute so much relative to their cost.