Sri Lanka has promised to “introduce a nationwide real property tax including a review of related fiscal transfers, requesting technical assistance as needed,” program documents said.

After the central bank printed money to maintain an artificially low policy rate, the currency collapsed and destroyed the non-real assets of most people including bank deposits, insurance savings and pension funds of the aged.

Real property however has been protected from the inflation tax of the central bank.“We will also introduce a gift and inheritance tax with a tax-free allowance and minimal exemptions,” the documents said.

“Preparatory work for these tax reforms will commence by mid-2023, supported by IMF technical assistance.”

Sri Lanka is trying to raise taxes to maintain a large public service and cabinet, under revenue based fiscal consolidation. Under revenue based fiscal consolidation in a previous program, spending to GDP went up from 17 to around 19 percent of GDP.