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Economy

Sri Lanka's VAT fiasco adds pressure, makes budget crucial

A man walks passed Sri Lanka's old parliament building now in the shadows of new high rise buildings coming up to change Colombo's skyline in the growing post-war economy. (Photo by Marwaan Macan-Markar)

COLOMBO -- Sri Lanka's finance ministers strike at midnight, while the country sleeps. The public wakes up to the shocking news in the Gazette, the government journal that prints official decrees, of price increases in selected goods following overnight tax increases.

President Maithripala Sirisena's administration last resorted to the "midnight gazette," as the local media describe this sly maneuver, on Aug. 19. The issue that justified its action? The imposition of a tax on imported large onions from India to protect local farmers producing smaller onions.

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