Commercial transportation gets severe beating from tax hikes
View(s):Sri Lanka’s commercial goods transportation has been hit badly following tax changes announced in 2013 budget.
Prices of small Lorries and commercial trucks used for goods transportation have gone up by Rs.500,000 to Rs. 700,000 , vehicle importers said.
Trucks had a 7 per cent port and airport levy and nation building tax, while the 2013 budget also imposed a 15 per cent excise duty raising taxes to 22 per cent, they added. The price of a single cab has also increased by 100 per cent to Rs. 5 million from Rs.2.7 million due to the tax hike of 127 per cent from the previous tax of 27 per cent. The transport and logistics sector is important for the Sri Lanka economy as it impacts the country’s transportation of agricultural produce from the fields to retail shops. The efficiency and effectiveness of this sector can translate into an increase in productivity of the economy and facilitate faster economic growth.
With the tax increase on small lorries and trucks the expansion of the goods transport fleet would be hindered as the demand for these vehicles will drop drastically, industry sources said.
The increase of these taxes will naturally increase the cost of purchasing new vehicles for transport operators who run small fleets of trucks as well as larger logistics operators. This will impact on re-fleeting ageing truck and lorry fleets of smaller operators throwing them out of business, they added.
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