Taxes lifted on small lorries and trucks
Sri Lanka’s goods transportation sector using small lorries and trucks is being affected by ad hoc tax increases of the Treasury hurting small businessmen and Indian and Chinese vehicle importers, motor traders said.
While the tax on trucks in Japan, Singapore, Malaysia and Pakistan is around seven per cent, in Sri Lanka it is around 49 per cent and the highest in the region, they said adding that this sudden tax hike may be targeted specially to hurt import of Indian vehicles.
Tax on small lorries and trucks rose sharply to 49.6 per cent with effect from January this year from 26 per cent in September last year.
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 taxes in this category were increased to 26 per cent from 15 per cent before the 2014 budget in September and to 49.6 percent from 26 per cent after the budget in January 2014.
The association has urged the Government to reconsider the tax revision imposed twice within four months which is exerting 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 shattered the dream of any small man 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 transporters of goods cannot buy a small new lorry or truck to expand his transport fleet as the price of such vehicles has gone up by Rs. 500,000 to Rs.600,000. Small businessmen engaged in transportation of vegetables and fruits have been hit badly and it will exert a negative impact on the economy, he added.