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Fact Check: Are Sri Lanka’s Taxes the Highest in the World, and Does It Have the Most Ministers?
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Due to the ongoing economic crisis in Sri Lanka, in recent years, the government increased tax rates as part of its recovery efforts. In response, social media has been flooded with misleading claims about these tax changes, leading to public confusion and misinformation. Many posts have exaggerated the impact of the tax hikes or spread false information about which sectors and items are affected. These false claims contribute to heightened public anxiety and misunderstandings about the government's fiscal policies during this difficult economic period.
Social Media Posts
Recently, social media posts have been spreading claims that Sri Lanka has the highest tax burden globally and the largest number of ministers.
We decided to do a fact check on this.
Fact Check
Claim 1: Sri Lanka has the highest taxes in the world
Reality:
This claim is false. A country’s tax burden is typically measured by its tax-to-GDP ratio, which reflects how much of a nation's economic output is collected in taxes. According to international data, Sri Lanka’s tax-to-GDP ratio is around 10-12% in recent years. This is significantly lower than many other countries.More details can be reached here
For example, the countries with the highest tax-to-GDP ratios include:
France: 46%
Italy : 43%
Germany: 39%
These countries collect almost half of their GDP in taxes, which is far higher than Sri Lanka's level
In fact, Sri Lanka's tax revenue as a percentage of GDP declined, particularly after the 2019 tax cuts. Its ratio is even lower than that of many Asian and African countries. However, tax revenue has increased since mid-2022 after imposing new taxes.
Globally, Sri Lanka’s taxes are considered low compared to many European nations that impose higher income taxes, social security contributions, and consumption taxes (like VAT). Even when compared regionally, Sri Lanka ranks below countries like India and Pakistan, which have tax-to-GDP ratios of around 15-16%(
Claim 2: Sri Lanka has the largest number of ministers
Reality:
This claim is exaggerated. While Sri Lanka has faced criticism for maintaining a large cabinet relative to its population, it does not have the most ministers globally.
Sri Lanka has historically had between 40 and 50 ministers, though the number can vary depending on the political context. The cabinet of ministers usually lies below 30, however, the number of non-cabinet ministers and state ministers often increases the overall count.Currently Sri Lanka has around 20 cabinet ministers and around 40 state ministers
For comparison:
India, with a population exceeding 1.4 billion, has 72 ministers in its central government.Details can be read here
France typically maintains around 35 ministers in its government.More details can be reached here
Nigeria, with a population of over 200 million, has a federal cabinet with 45 ministers.Details can be reached here
Sri Lanka's cabinet size may seem large relative to its population of 22 million, but several other countries, particularly larger democracies, have more ministers in their governments.
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Conclusion
Both claims are misleading. Sri Lanka does not have the highest tax rates in the world, and it does not have the largest number of ministers. Many countries in Europe and Asia have higher tax burdens, and several other nations maintain larger cabinets.
This type of claim likely arises from frustrations regarding governance and economic challenges in Sri Lanka, but the factual data tells a different story.
