It has come to light that since the prices of motorcars and vans face a reduction according to the 2015 Budget proposals, vehicle importing companies have begun discussions with the government to urge for concessions on vehicles imported under the earlier duty system and hence they are yet to reduce the prices of motorcars and vans.

Even by this morning (29 October) prominent vehicle importers in Sri Lanka had not reduced the prices of these vehicles in accordance with the Budget. Meanwhile, adaderanabiz.lk learns from very reliable sources that since these importers would have to face losses in selling the already imported vehicles at the new prices, they expect the government to provide them some avenue to offset these losses.

It is learned that the government has not responded positively to this request.

When adaderanabiz.lk inquired from several leading vehicle importers in Sri Lanka, all of them said that except the hybrid models the prices of all other motor vehicles are expected to be reduced in keeping with the 2015 Budget but the new prices have not been announced yet.

Recently, the Deputy Secretary to the Finance Ministry told adaderanabiz.lk that the customs duty on motorcars would decrease by around 20 to 25 per cent and on vans by around 25 to 65 percent due to the new tax amendments imposed through the 2015 Budget proposals.

Finance Ministry Deputy Secretary S.R. Attygalle said these Budget proposals would be effective from midnight on 24 October and that the prices of motorcars and vans would definitely decrease.

“A special tax has been introduced through this Budget which includes all the duties in the import of motorcars and vans. Hence, the prices of these vehicles would definitely decrease,” said Mr. Attygalle.

According to this new tax amendment, the 202 per cent duty on the import of motorcars below 1000 cc engine capacity had been reduced to 173 per cent.

Accordingly, the import duty on small motorcars would decrease by around 29 per cent.

Where vans are concerned, the 175 per cent duty on cargo vans and the 126 per cent duty on 13 to 20 seater vans have been slashed by 100 per cent.

Vehicle Importers’ Association of Sri Lanka chairman Sampath Merinchige told Adaderanabiz.lk that these reductions would mostly affect the prices of vans and that the price of a Hiace van may fall by as much as Rs. 10 lakhs.

The prices of 1,000cc engine motor vehicles would fall by about Rupees two to three lakhs, said Merinchige.