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Vehicle prices slashed by 25 per cent
View(s):Prices of some vehicles are set to plunge by an average of 25 per cent with immediate effect, Deputy Treasury Secretary S. R. Arttygalle said.
Following a budget proposal to reduce taxes on vehicle imports, taxes on all vehicles would be reduced regardless of engine capacity.
The tax on a 1000cc vehicle will be reduced from 202 per cent to 173 per cent while similar tax reductions will apply to vehicles with 1600cc, 2000cc, and 3000cc engine capacity.
The duty on cargo vans and 13 to 20 seater vans has been slashed by 100 per cent. “This was a special request from tour operators. This would also help the tourism industry,” Mr. Arttygalle explained. He said the tax concessions for cars had been given to encourage more imports to the country and increase the tax revenue. The treasury expects an additional revenue of Rs.5,000 million.
Vehicle importers welcomed the move. This was a procedure the importers had been seeking for years, as the move simplified the tax process, Vehicle Importers Association President Asiri Merenchige said. Explaining the impact of the tax, he said that while there might be significant reductions – up to Rs. 300,000 – in the prices of vehicles with engine capacity of 1000cc or less , the reduction in prices of other types such as hybrids would only change marginally.
However, more passenger transport vehicles will now come into the country.
“Earlier we did not import many vans as we found it difficult to sell them. But under the new scheme it would be profitable to import such vehicles,” Mr. Merenchige said.