Sri Lankan motor trade urges level playing field for all stakeholders
Sri Lanka’s motor trade representing the world renowned manufacturers of major automobile brands, is urging the authorities to maintain consistent policies, and look at the industry as a whole without targeting and favouring certain segments of the market. Motor traders made this appeal at the 96th Annual General Meeting of the Ceylon Motor Traders Association (CMTA) in Colombo recently. The Government has changed the total custom duty structure, by giving away the acceptance of manufacturers invoice value for duty calculations. And with the introduction of the unit rate tax system purchasing cars of over 1500 CC is beyond anyone’s reach with an average increase of Rs. 4 million whilst a top end vehicle can even go up to Rs.10 million, they revealed. Motor traders called on the government to look at the industry as a whole without targeting and favouring certain segments of the market and a have a level playing field for all stakeholders.
Many franchise holders do not have vehicles below 1500 CC. It is mostly available only in the Japanese domestic market where used cars are being imported, and the end result will be that the majority of the market shifting towards used vehicle imports, a leading motor trader said. New challenges include the import of zero mileage cars by used car importers with better options, government’s consideration for offering discounts for the valuation of used cars that has become and can become a major threat to the professionally set up franchise holders, the outgoing chairman of CMTA Gihan Pilapitiya pointed out. He said that the preference given in the new tax structure for less than 1500cc cars, a segment predominantly held by the used car importers should be of concern to all motor franchise holders.
However he noted that last year was among the best ever years for the automotive trade in Sri Lanka with the overall volumes increasing to almost 670,000 units and the majority of the companies in the trade announcing the best ever results. Mr. Pilapitiya emphasised the need of unity of all motor traders to fight for taxes to be based on the actual transacted values certified by the manufacturers, keeping away personal preferences. The motor trade in recent times is faced with turbulence and with daunting challenges in the recent times, the newly elected chairman of CMTA Reeza Rauf said adding that it will not be an easy task to manage. He expressed the belief that motor traders will overcome these challenges with all their valuable inputs and support, while striving to meet these challenges with all success.