Lanka IOC to maintain oil prices despite 15 % tax
View(s):By Bandula Sirimanna
Lanka IOC, Indian oil’s subsidiary in Sri Lanka, would continue to maintain fuel prices on par with the Ceylon Petroleum Corporation despite being costlier.
The company will start paying a 15 per cent tax from mid-February following the end of the 10-year tax holiday, a top official of the company said.
In an interview with Business Times, LIOC Managing Director Subodh Dakwale said that the company has to allocate at least Rs. 150 million for tax during this financial year.
Mr. Dakwale noted that they will absorb the additional tax costs without passing it to consumers.
Referring to immediate plans of the company, he disclosed that they will further expand their lubricant business to South-East Asian countries by appointing “Servo” lube distributors in Bangladesh and Myanmar.
The company currently exports lubricants to Nepal and Maldives.
“Servo” has a 16 percent share in the Sri Lankan market, he said.
The company made a profit of Rs 877 million in FY 2010-11 and Rs. 906 million in FY2011-2012. The first half 2012-13 financial year performance was satisfactory he said adding that final accounts for the financial year are now being prepared.
The LIOC tank farm at Trincomalee will be refurbished with an investment of US$ 17million to set up a bitumen handling facility, he revealed. The tank farm has a total of 99 tanks, each with a capacity of 12,000 kilolitres.
Mr. Dakwale said the company is urging the government to implement a pricing formula to operate the business profitably in a level playing field in the midst of a volatile world market.
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