New Year bolt: Food prices soar

By Chris Kamalendran

Essential food items, including dhal, sugar, onions and potatoes, are set to go up in price before the National New Year following a government decision to impose an additional import tax on these items, an official said yesterday.

Consumer Affairs Ministry Secretary Lalith Silva said the Finance Ministry had issued a directive to increase the cess on more than 20 items. He said this would result in a price increase, but he defended the measure saying it was to “protect the local farmers and promote local products.”

The extra tax will also apply to Salmon (tin fish), sprats, dried fish, chillies, gram, green gram, green peas and yellow gram. The tax varies from a Rs. 20 to Rs. 85 per kilogram. Traders association officials said yesterday they would be forced to increase the prices of these items before the New Year.

Accordingly, the price of a large tin of salmon will go up from Rs. 190 to Rs. 230 while the price of sugar will rise by Rs. 18 a kilogram. The price of dhal will go up from Rs. 210 a kilogram to Rs 240, big onions from Rs. 70 to Rs. 100 a kilogram and the price of dried chillies will go up by Rs. 40 a kilogram.

Colombo Traders Association Secretary G. Nathan said that in addition to raising prices, they would have to take a close look at the world market and consider curtailment of imports. He said that they had no option but to pass on the increased prices to consumers.

Old Moor Street Traders Association President Palaniandy Sundaram said prices of imported items might have to be increased further because of the tumbling value of the rupee in relation to the US dollar. During the past few days, the value of the rupee has fallen to Rs. 116 a dollar.A gazette notification on the new tax is due to be published in the next few days.

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