Tax cuts to boost transport and logistics sector
View(s):In the wake of reducing revenue amidst a decline in vehicle imports, the Sri Lankan Government is to bring down import duty on small lorries and trucks to facilitate goods transportation, official sources revealed.
The Treasury is considering a cut in import duties on these categories which had risen sharply to around 49 per cent from 26 per cent, a senior government official told Business Times.
This was a result of requests made by motor traders to the president who is also the country’s finance minister. Treasury Secretary Dr. P.B. Jayasundera has also responded favourably to the request.
Tilak Gunasekera, President of the Ceylon Motor Traders’ Association, who is also the CEO and Executive Director of Sathosa Motors Plc, told the Business Times that the association had appealed to the Government to reconsider the tax revision imposed twice within four months owing to an adverse impact on the vehicle import industry that has been hit by fluctuating duty for the past several years.
These lopsided Treasury regulations have also affected small entrepreneurs engaged in self-employment to buy a small lorry or truck
The association also demanded the government to adopt a consistent tax policy on vehicle imports.
Mr. Gunasekera said that Sri Lanka’s new registrations of trucks, tractors and lorries have come down in January 2014 as the price of such vehicles has gone up by Rs. 500,000 to Rs.600,000.
According to Motor Traffic Department statistics mini truck registrations were 1,305 units in January 2014, down by 10 per cent from a year earlier.
This sector was spearheaded by India’s Tata with a 49.7 per cent share and Mahindra with a 48.8 per cent share.
Small truck sales have also dropped by 37 per cent compared to statistics in 2012, he revealed.
New registrations of medium sized trucks (2-5 tonnes) have come down 24 per cent to 159 units in January 2014 from a year earlier.
Heavy truck registrations were also down 38 per cent to 131 units.