Sri Lanka's 2016 budget deficit is estimated to be better than the International Monetary Fund (IMF)-approved target of 5.4 percent of gross domestic product (GDP), boosted by improved revenue, Finance Minister Ravi Karunanayake said on Monday.
The island nation has agreed with the IMF to reduce the budget deficit to 5.4 percent from the previous year's 7.4 percent in return for the $1.5 billion three-year loan approved in June last year.
"Our budget deficit is even less than what was approved by the IMF," Karunanayake told Reuters.
President Maithripala Sirisena's government faced legal battle in raising value added tax (VAT) to 15 percent from 11 percent last year until November 1.
Finance ministry officials have told Reuters that the delay resulted in a loss of over 80 billion rupees ($533.3 million).
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