Except for a few showers in Galle, Matara, Kaluthara and Rathnapura districts in the evening or night, mainly fair weather will prevail over the island.
Misty conditions can be expected at some places in Western, Sabaragamuwa, Central, North-western, Northern and North-central provinces and in Galle and Matara districts during the morning.
Daisy Forrest also known as ‘Daisy Achchi’, grandmother of Yoshitha Rajapaksa, has been summoned to the Criminal Investigation Department (CID) today (March 5) and is currently providing a statement, according to sources.
Internal reports suggest that she is expected to be arrested later today and subsequently produced before the Kaduwela Magistrate’s Court.
Further details regarding the charges or reasons for the interrogation remain undisclosed at this time.
The Collective for Senior Citizens has urged the government to reinstate the 15% interest rate on fixed deposits of up to Rs. 1.5 million, citing severe financial hardships faced by elderly citizens.
At a press conference held on Tuesday at the Lions Club in Colombo, representatives of the group accused the government of failing to honor its pre-election promise, leaving seniors struggling to cover basic living expenses, including healthcare costs.
Speakers at the event criticized the government’s tax policies, arguing they disproportionately burden ordinary citizens while large corporations have not been subjected to similar tax increases. They also condemned the decision to double the Withholding Tax on savings interest from 5% to 10%, saying this move has further worsened the economic struggles of retirees.
“The reduction in interest earnings has made it increasingly difficult for seniors to afford food, medication, and other essential expenses,” the group stated. They demanded the immediate reinstatement of the 15% fixed deposit interest rate, which was in place before the economic crisis.
Despite formally requesting a meeting with the Ministry of Finance, the group said they have not been granted an opportunity for discussions.
The press conference was attended by Dayapala Thiranagama, Melani Gunathilaka, Rachel Perera, Ananda Sisira Kumara, Janaki Senavirathna, and Attorney-at-Law Nuwan Bopage, who spoke on behalf of Sri Lanka’s senior citizen community.
Prime Minister Dr. Harini Amarasuriya emphasized that the qualitative change required for a new society must begin within ourselves, as the government advances plans to modernize cooperatives and strengthen the rural economy.
Addressing the Women’s Forum at Sunanda Theatre, Aranayake, the Prime Minister stressed that Sri Lanka is at a critical juncture and must be guided on the right path. She asserted that the government alone cannot bring about transformation—it requires the combined efforts of government officials, religious leaders, and citizens.
Dr. Amarasuriya praised the role of women in reshaping the nation’s political landscape and urged them to step forward into leadership roles. She highlighted the government’s Clean Sri Lanka program, which goes beyond environmental cleanliness to instill positive behavioral and attitudinal change in society.
“Change must begin within individuals—at home, in villages, and in workplaces. Women play a vital role in this journey of national transformation,” she stated.
The Prime Minister elaborated on the 2024 budget, which is designed to promote economic democracy by ensuring benefits for all. She noted key reforms, including:
Dr. Amarasuriya underscored that education is the key to national transformation, announcing new education reforms set for implementation in 2026. The 2024 budget includes substantial investments in teacher training and infrastructure development to support these reforms.
The event was attended by a large gathering, including members of the Maha Sangha, Minister of Environment Dhammika Patabedi, MP Nanda Bandara, and numerous women from the Aranayake region.
Sri Lankan migrant workers are exempt from the 15% tax and are not subject to taxation on the money they remit to Sri Lanka. Additionally, any interest earned on such remittances held in foreign currency bank accounts is also exempt from income tax under Section 9, in conjunction with the Third Schedule of the Inland Revenue Act No. 24 of 2017 (IRA 2017).
According to the IRA 2017, residents of Sri Lanka are taxed on their global income, subject to certain exemptions, as per Section 69(1). Conversely, non-residents are taxed under the same section only on income derived from employment, business, investments, or other sources within Sri Lanka (Section 4). Since migrant workers earn their income from foreign employers outside Sri Lanka, such income does not fall under “income arising in or derived from a source in Sri Lanka,” making it exempt from taxation.
Residency Status of Migrant Workers
Typically, migrant workers are “domiciled” in Sri Lanka but are not considered “residents” for tax purposes. However, in the year of departure for foreign employment and the year of return, their residency status must be evaluated to determine tax obligations. As a general rule, migrant workers are deemed non-residents and are therefore not liable to pay income tax on their foreign earnings.
Residency status is determined by Sections 69(1) and 70(1) of the IRA 2017:
Section 69(1): A person is considered a tax resident if they either reside in Sri Lanka or are present in the country for at least 183 days within any 12-month period.
Section 70(1): A person who meets the 183-day criterion is considered a resident from the beginning of that period, while others are treated as residents for the entire tax year if they meet the residency conditions.
Understanding “Domicile” vs. “Residence”
Tax residency involves two key concepts:
Domicile refers to a person’s permanent legal home, which is the place they intend to return to, even if they live elsewhere. A person can only have one domicile at a time.
Residence refers to the place where a person physically lives. Unlike domicile, a person can have multiple residences, and it is considered a short-term status.
For instance, a Sri Lankan migrant worker employed in Dubai under a four-year contract is domiciled in Sri Lanka but does not reside there. Section 69(1)(a) considers only those who “reside” in Sri Lanka as tax residents, meaning migrant workers generally fall outside this definition. However, special provisions in Section 70(1) apply in the year of departure and return.
Legislative Background on Residency Definition
Initially, the Inland Revenue Bill of 2017 included “domicile” as a tax residency criterion under Section 69(1)(b). However, this provision was removed following advocacy by the Tax Committee of the Sri Lankan Bar Association to protect migrant workers. The original wording proposed that individuals domiciled in Sri Lanka would be tax residents unless they had a permanent home abroad for the entire year.
Conclusion
Since the reference to domiciled persons as tax residents was removed from Section 69(1), migrant workers are not subject to income tax on foreign earnings. This exemption remains despite recent budget proposals to impose a 15% tax on service exporters. As a result, Sri Lankan migrant workers can continue to remit foreign income without tax liabilities in Sri Lanka.
Sri Lanka’s tourism industry is experiencing strong growth, with over 492,000 visitors recorded in 2025 so far, reflecting an optimistic outlook for the sector. February alone saw more than 240,000 arrivals, surpassing the previous year’s performance and reinforcing the industry’s upward momentum.
The Sri Lanka Tourism Development Authority (SLTDA) reported an average daily arrival of 8,859 tourists, an increase from last year’s 8,282 per day during the same period.
Following a successful 2024, SLTDA set an ambitious goal of attracting 310,937 visitors in February, after recording 252,761 arrivals in January. While January achieved the highest monthly tourist numbers ever, it still fell short by 52,926 visitors from its projected target of 305,687.
Key source markets contributing to this growth include India, Russia, the UK, China, and Germany. Other significant inflows came from France, Poland, Australia, the Netherlands, and Bangladesh. The industry is closely monitoring the rollout of a global promotional campaign, which is expected to boost arrivals further.
February’s 240,217 arrivals pushed the total for 2025 to 492,978, reaffirming the sector’s positive trajectory. Compared to February 2024, this represents a 10.01% year-on-year (YoY) increase and a 2% rise over 2018, a benchmark year for tourism in Sri Lanka. The average daily arrivals also improved, reaching 8,579 in February, up from 8,154 in January 2025 and 7,044 in February 2024.
However, February’s figures showed a slight 5.22% decline compared to January, reflecting a month-on-month dip despite overall strong performance. Weekly arrival patterns indicated a steady inflow of tourists, with 61,664 arrivals in the first week, 63,163 in the second, 59,606 in the third, and 55,784 in the final week. Despite these numbers, February fell short of its projected target by 70,720 visitors, a 29.44% gap.
India continues to be the leading source market, contributing 35,728 tourists in February, followed by Russia (30,295), the UK (25,528), Germany (17,233), and France (15,469). Other significant contributors included China, Australia, Poland, the US, and the Netherlands. Year-to-date (YTD) figures show India leading with 79,103 arrivals, followed by Russia (64,391) and the UK (47,258).
Sri Lanka aims to attract 3 million visitors in 2025, with a revenue target of $5 billion. In contrast, 2024 recorded 2.05 million arrivals, generating $3.2 billion—reflecting a 52.38% YoY revenue increase. The industry’s positive start in 2025 is evident, with January alone generating $400.7 million, marking a 17.2% increase from the previous year.
With the winter tourist season continuing until the end of March, Sri Lanka’s tourism sector remains optimistic about achieving its ambitious goals for 2025.
The Employees’ Provident Fund (EPF) has suffered close to Rs. 20 billion in losses from bond and equity market investments, with an additional Rs. 12 billion in foregone earnings, as a result of bypassing due process and investing in unlisted equity, according to a new report by Verité Research.
The report has calculated these losses and foregone earnings by analysing the findings of two forensic audit reports commissioned after a series of investigations into the infamous ‘bond scam’ of 2015.
The key findings of the report are: Bond market losses: The EPF incurred losses of Rs. 9,826 million (2002-2015) as a result of acquiring bonds at unfavourable prices.
Equity market losses: The EPF incurred losses of Rs. 9,859 million (1998-2017) from irregular investments in the equity (share) market, most of it a result of the ‘pumping-and-dumping’ of shares to the EPF.
Unaccounted equity losses: The EPF also incurred Rs. 12,382 million (2007-2017) as foregone earnings by investing in unlisted companies instead of Government securities, which provide fixed positive returns every year.
The full extent of the losses is not captured due to two serious limitations in the forensic audits. (i) The bond market audit only covers transactions up to February 2015, excluding losses that occurred in the aftermath of the ‘bond scam’ of February 2015 and (ii) The audits identify only the direct losses from transactions where there is documentable violation/an anomaly in the conduct of the transaction; the foregone earnings from such transactions are not reported by the audits
The EPF investments in the stock market returning less than 5% when the market index increased byover 100% is not identifiable as a loss in the forensic audit methodology. Only transactions that can be traced topump-and-dump schemes or are identified as violating the investment guidelines are identified as causing losses.
Such limitations significantly reduce the scope of what can be estimated on the losses incurred by the EPF – makingwhat has been enumerated by these forensic audits akin to the visible tip of the iceberg.
The majority of the EPF’s bond market losses, identified totalling LKR 8,973 million, stem from transactions in theprimary market where government securities are bought through direct placement from the Public Debt Department (PDD) of the Central Bank.
In this transaction method, the yield of the securities is fixed through an offer made by the PDD, unlike in auctions where the prices are determined through competitive bidding among multiple investors.
Theoffers can be public and the same for all market participants, but it has in the past also been private and differentto different market participants. This private offer arrangement is not transparent and prone to abuse.
The EPF is particularly vulnerable as the Central Bank that offers the debt through its PDD (as the agent of the government) can also be the buyer through its EPF department (as the custodian of the EPF). The standard practice for deciding the yield of a security sold through direct placement has been to base it on the weighted average market price of the previous auction. The forensic audit evaluates cases where the EPF faced losses from purchasing direct placements at off-market prices. See Box 1 for the forensic audit methodology in calculating the losses
Maintaining a cost-reflective electricity pricing formula is crucial for Sri Lanka to adhere to the structural benchmarks set by the International Monetary Fund (IMF). Such a mechanism ensures financial stability within the energy sector, preventing the accumulation of unsustainable losses that could ultimately become a burden on public finances.
By adhering to cost-recovery pricing, Sri Lanka can avoid fiscal risks and ensure compliance with IMF parameters, which is vital for securing continued financial assistance and maintaining economic stability.
Sri Lanka has breached a structural benchmark in the IMF program following a 20 percent electricity tariff reduction implemented by the country’s regulator.
The tariff cut, which came into effect on January 17, has raised concerns about potential losses for the Ceylon Electricity Board (CEB) in the coming months. According to an IMF staff assessment, avoiding such losses will be a key requirement for passing the next program review.
One of the most critical next steps for Sri Lanka in meeting IMF program expectations will be to pass a budget that aligns with program requirements.
The downward revision in tariffs has led to a situation where the CEB is projected to incur losses, necessitating corrective measures to restore cost-recovery pricing.
To address this, authorities have committed to ensuring the Bulk Supply Transaction Account (BSTA) operates as designed, with an automatic adjustment mechanism triggered when the CEB’s cash balances reach a lower threshold.
If this mechanism does not sufficiently offset losses, an April tariff revision will be required to restore cost-recovery pricing.
Despite the CEB’s proposal for a modest 3 percent tariff cut for January 2025, the regulator imposed a more significant reduction.
The IMF has emphasized the importance of allowing automatic pricing mechanisms to function to prevent future debt accumulation within the electricity sector.
Peter Breuer, the IMF’s Senior Mission Chief for Sri Lanka, highlighted that fluctuations in electricity costs are influenced by several factors, including weather conditions, which impact hydropower generation.
He warned that failing to maintain cost-reflective tariffs could lead to rising contingent liabilities for the government.
Sri Lanka has already taken steps to reduce the time gap between tariff adjustments to three months, addressing issues caused by unpredictable weather conditions and fluctuating energy costs.
Previously, a sudden price hike was necessary when dry weather conditions forced the CEB into losses following a substantial tariff cut.
However, with the change in administration, there appears to be a reversion to six-month tariff adjustments, which could undermine financial stability if not managed effectively.
Labour Minister and Economic Development Deputy Minister Prof. Anil Jayantha Fernando rejected Opposition allegations regarding the Government’s stance on the Adani Group’s investment and fuel pricing, emphasizing that all investments are evaluated with full transparency, regardless of the investor’s identity or country of origin.
Speaking in Parliament yesterday, Prof. Fernando clarified that the Government is committed to expanding investments in multiple sectors, including energy. He dismissed claims that the Adani Group had “suspended” or “pulled back” from its projects in Sri Lanka, calling such assertions misleading.
Addressing concerns over power purchase agreements, he explained that before the current administration took office, a 20-year agreement had been signed at US cents 8.26 per unit, which was deemed a high rate. During a pre-election visit to India, discussions revealed that Adani supplied power to the Indian grid at US cents 3.50 per unit. When questioned about the price difference, Adani officials cited investment risk factors as the reason. Consequently, the matter was referred to the Cabinet for further review to ensure transparency.
On fuel pricing, Prof. Fernando rejected Opposition claims that the Government was overcharging consumers by adding a Rs.10 surcharge above production costs. He stated that under the Government’s pricing formula, the production cost of petrol stands at Rs. 308.89 per litre, while the retail price is Rs. 309 per litre, proving there is no excessive markup.
“The Opposition is deliberately spreading false information to mislead the public,” Prof. Fernando asserted, reaffirming that Sri Lanka welcomes all investors fairly and transparently without giving undue preference to any company or country.
The National Transport Commission (NTC) has announced special bus services for the upcoming Tooth Relic Exposition, which is being held for the first time in 16 years. Operations Director Shereen Athukorala confirmed that discussions with relevant officials took place yesterday to finalize transport arrangements for the event, which coincides with the Sinhala and Tamil New Year period.
Buses operating between Colombo and Kandy will be directly managed by the NTC, while temporary driving permits will be issued for provincial buses to accommodate the anticipated influx of devotees. These special services will commence on April 18, aligning with the opening of the exposition, and will supplement the regular daily bus services.
The Tooth Relic Exposition will begin on April 18, with the inaugural day’s viewing scheduled from 3:00 p.m. to 5:30 p.m. From April 19 to 27, the relic will be exhibited daily from 12:00 p.m. to 5:30 p.m.
