Sri Lanka gets ADB help to get more taxes, spend better

Apr 16, 2010 (LBO) – The Asian Development Bank said it will give Sri Lanka a 50 million US dollar loan to improve government revenue management, including tax collection, and state spending on infrastructure and the poor. It said in a statement that the ADB and Japan will support Sri Lanka with fiscal reforms to promote investment.

Finance Management

The loan will help Sri Lanka “continue with public finance management reforms aimed at paving the way for increased investment in underdeveloped areas, including those severely affected by conflict,” it said.

“The cornerstone of the loan will be to finance a project for the introduction of revenue administration management information and integrated treasury management information systems,” said K Shin, Senior Economist (Financial Sector) of ADB’s South Asia Department.

“(This) will strengthen compliance, tax collection, and improve efficiencies and decision-making on the allocation and use of resources.”

The ADB loan has a 25-year repayment term with a five-year grace period and interest determined in accordance with its LIBOR-based lending facility.

The government of Sri Lanka will provide in-kind counterpart funding of 10 million dol