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Old prices remain despite tax reduction sans gazette notice
Taxes on essential food items and commodities that were ‘reduced’ through an announcement by the Finance Ministry, haven’t yet been gazetted and hence, the old prices stand, officials said.
“The Government hasn’t issued a gazette notification yet, nor informed us of when one would be ready. We have to wait till the Cabinet settles first and the subject Minister issues a gazette notification. Then only can we revise the prices,” said Consumer Affairs Authority (CAA) Chairman Anura Meddegoda.
The Consumer Affairs Ministry portfolio was given to Johnston Fernando on Friday.
It was stated that the Government had reduced the sugar tax by Rs 10 a kg, and the special commodity levy for dhal and chickpeas by Rs 5.
Meanwhile, following the reduction of fuel prices this month, bus fares were reduced by 2%, with a collective decision made by a number of Bus Operators associations. However, when the previous regime increased fuel prices by an amount similar to the present decrease, bus fares shot up by 12.5%. The first 3 price ‘tiers’ remain unchanged at Rs 12, Rs 15 and Rs 20 respectively, while the 4th ‘tier’, which was at Rs 25, has been reduced by Re 1.
“The National Transport Commission (NTC) is the authority that decides on the final figure of percentage reduction,” said Transport Ministry Secretary G.S. Withanage. “They have a formula to calculate the percentage. The Transport Ministry has to accept and gazette any decision made by the NTC on such matters.”
Mr. Withanage said that a train fare reduction wasn’t under consideration at present. “Reducing train fares require lengthy discussions with the unions and other stakeholders first,” he said.
Private Bus Owners Association President Gemunu Wijeratne, who proposed the 2% decrease, said he felt that the 1st 3 price ‘tiers’ should also have been decreased. “Rs 12 is too much for the minimum fare,” he said.
“When the fare was increased by 12.5% in May, our association was opposed to it. We recommended an increase of 8%-10%. The NTC suggested 6.5%. However, certain unions with connections to the then ‘Joint Opposition’ demanded a 15%-20% increase. The NTC settled on 12.5%.”
Despite claims that trishaw fares were reduced by Rs 5 for the 1st km, it hasn’t yet been done. Most trishaws charge Rs 60 for the 1st km (the increased rate following the fuel price hike earlier in the year) and Rs 40 for every km after that, although there is an inconsistency with some charging higher rates, and some lower ones.
The Government’s proposed reductions of the Value Added Tax (VAT) will only come into effect from January 2019.
Meanwhile, the Telecommunication Levy was reduced by 10% yesterday (10).