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Minister C B Ratnayake who is in charge of the 'private transport services' ministry said the new fares will be apply for a year.
Air conditioned buses are allowed to charge double fare.
Gemunu Wijeratne, representing Lanka Private Bus Owners’ Association had threatened to go on strike next Monday, the Daily Mirror newspaper said.
Sri Lanka started increasing fares according to a cost-based formula several years ago after ministers looking for cheap popularity kept fares down and bus operators could not get lease finance to buy a new bus.
Sri Lanka also has a state bus service, which is overstaffed and its costs are topped up with taxes extracted from the people by the state through other means.
Sri Lanka private bus services are also fraught to problems as independent operators compete for passengers on the same route. Attempts by authorities to create system operators by consolidating bus owner