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Sri Lanka currently has a very low tax-to-GDP ratio - just above 8 percent at this time. It was 12 percent to GDP prior to the aforementioned cuts. Not only is the tax revenue low, but direct taxes Economy' of Sri Lanka. Sri Lanka, through the centuries, has prospered on creativity; from painting, crafts making, literature, architecture to a diverse platform of performing arts, they have remained powerful expressions of social values and culture and promoted social integration. The creative industries were the mainstay of sustainable economic The country's foreign reserves stood at 2.31 billion dollars at the end of February Sri Lanka has to repay foreign debt totaling nearly seven billion dollars this year President raja paksha recently said that the country will incur an import bill of 22 billion dollars this year resulting in a trade deficit of 10 billion dollars The economy of Sri Lanka was crumbling much before covid but even with such problems, the political party of the Rajapaksha went on subsidizing things as much as possible like cutting taxes, and distribution of free food commodities for gaining votes. Despite the economic downturn in 2019, 15% VAT tax was reduced to 8% and this made the people very happy but the tax collection of Sri Lanka fell in half. All these things were happening before covid. As the covid arrived the tourism Sri Lanka economy collapse - the key information " "Our economy has completely collapsed." " — Prime Minister Ranil Wickremesinghe to parliament. One of the main causes of the economic crisis in Sri Lanka is the reliance on imports and the amount spent on them. Let's take a look at the numbers: 2021 total imports = $20.6 billion USD