The International Monetary Fund (IMF) said on Friday that Sri Lanka's government needs to implement a tax reform package without delay, pointing out that the country has failed to raise taxes as promised when it received a $1.5 billion loan from the lender in June.

An IMF mission, which concluded nearly two weeks of discussions with authorities, commended Sri Lanka for implementing the IMF-supported economic programme under "difficult circumstances" and had met all June-end targets.

"However, some forward looking aspects of the programme review, mainly related to the implementation of the tax reform package need to be addressed without further delay," Jaewoo Lee, the mission head. told reporters in Colombo.

The government delayed implementation of tax hikes expected to take effect on May 2, due to two Supreme Court rulings. The government is considering to bring an amended tax hike proposal in the near future after addressing public concerns. The VAT (Amended) Bill will soon be presented in Parliament while the Nation Building Tax Bill got the Supreme Court's nod after being challenged.