Financial Times

The importance of collecting tax, while facilitating trade was highlighted at the Key Person’s Forum by Sarath Jayatilake, Director General Customs recently.

Organised by the Small and Medium Enterprise Developers (SMED) a project of the Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL) and Friedrich

Naumann Stiftung, the Customs chief speaking about the Present Services of the Sri Lanka Customs for Exporters and Importers, said that there is a pressing need for tax collection while facilitating import and export trade.

“Many people in the import and the export business are not aware of the rules and the regulations of the Customs. There is a vast ignorance of law,” he said. He said for example, many importers of motor vehicles are not aware that a motor vehicle can only be imported by opening of a letter of credit (L/C). “This is a must and many do not know the limitations of telegraphic transfers,” he said. Jayatilake said that 30 percent of the total revenue in Customs was derived from motor vehicle imports.

He said that last year 35 percent of the total revenue of the government was through value added tax (VAT) and 58 percent of the total trade tax (both imports and exports) was collected through the Customs.

“In 2005 the total government revenue was Rs 379.7 billion, which was a 21.9 per cent increase from 2004. It is 16.1 percent of the gross domestic product. Out of the total tax revenue of Rs 379.7 billion, the Customs Department collected Rs 191 billion, which is a little more than 50 percent,” he said. Highlighting the importance of electronic data transfers, Jayatilake said that it is important to be aware of the directives and the controls of using credit cards.

The Key Person’s Forum provides a platform for public lectures, seminars and discussions featuring eminent persons who share experiences and policy perspectives on a face- to-face basis.