Slower increase in excise duty expected

Sri Lanka can expect a slower excise duty increase, after a cumulative hike of around 64 percent over a 12-month period through January 2024, said Fitch Ratings.

The government is required to review excise duties, including those on alcohol products, on a yearly basis as part of the International Monetary Fund’s (IMF) extended fund facility programme. 

According to Fitch Ratings, further excise duty increases are expected to be in line with Sri Lanka’s inflation rate, but risks to sales volume from higher-than-expected excise duty hikes, as seen in January 2024, remain.