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Former Central Bank Governor A S Jayawardena said achieving revenue targets will be crucial for the success of the budget in a wide ranging interview with LBR about budgeting and Monterey Policy. Former Central Bank Governor A S Jayawardena said achieving revenue targets will be crucial for the success of the budget in a wide ranging interview with LBR about budgeting and Monterey Policy. Excerpts:-

LBR: What is the importance of having a current account surplus, in terms of the budgeting process itself and the overall impact on national savings?
A.S. Jayawardena: The idea of Current Account surplus is that it can be used for investment. In Sri Lanka all of the investment is done by borrowing. Not by the savings of government. The government is not good at saving.

It is not a good sign of a good budget.

LBR: Revenue targets have been raised significantly. What are the main challenges in achieving the targets?
AS: There are changes in the VAT. They have introduced three bands instead of a single rate VAT –that will be a little complicated in administration.

But they have also raised the levels and there should be some additional revenue.