Japanese auto delegation due here to discuss duty anomalies

By Shabiya Ali Ahlam

A 40-member Japanese delegation is slated to visit Sri Lanka in October this year, in order to look at the possibilities of streamlining the automobile industry that is being currently impacted by the Treasury’s ad-hoc tax policies.

The Sri Lanka Automobile Exporters Association in Japan (SLAAJ) officials told reporters in Colombo yesterday that a meeting has been arranged between relevant authorities from both countries where the delegation from Japan would put forward their suggestions to have a more predictable duty structure for the importation of vehicles.

The Japanese officials along with the SLAAJ members would request having the duty fixed for a period of five years. 

Currently the national budget revises the import duty on an annual basis and its implementation is often done overnight.  Proposals would contain the request for a reduction in the import duty, which is currently about 300 percent on the sale value.

According to SLAAJ President Nishantha Meegalla, the annual revision of the vehicle importation duty in national budget has resulted in importers bringing down excess units prior the proposal announcement to avoid any negative implications.

“A steep increase in vehicle imports is observed in the months of October and November since importers are unsure what the duty they would be slapped with. These shipments take several weeks to reach Sri Lanka, and when an overnight duty is imposed we undergo losses,” stressed Meegalla.

For this reason, he said the local customers are at a disadvantage since the revisions often lead to price increases. 

It was also pointed out that for reconditioned vehicles, it has become the norm for certain importers to forge the inspection sheet and hide the exact condition of the automobile, deceiving customers.

In an effort to curb such issues, the SLAAJ will also hold a workshop following the meeting, for those engaged in the vehicle importation trade, where the participants will be educated on import procedures and regulations and other areas of importance. 

The resource persons for the workshop would be from Japan and Sri Lanka.