Auto industry says govt.’s latest vehicle permit move impractical

• Says not enough stocks of unregistered vehicles available for purchase except for smaller cars
• Points out it doesn’t make economic sense for a permit holder to buy a smaller car 
• Stresses that asking importers to bear the risk is unreasonable 

By Shabiya Ali Ahlam
Local motorcar dealers, whose business has taken a hit due to the ban imposed on vehicle imports, asserted that the government’s decision to allow permit holders to purchase unregistered vehicles using the concession is impractical and unjust. Sharing the stance of the auto industry with Mirror Business, Ceylon Motor Traders Association (CMTA) Chairman Yasendra Amerasinghe said the industry does not welcome the government’s decision in this regard.

“It is not a practical proposal. There aren’t enough stocks of unregistered vehicles available for purchase in the first place since we cannot import. As of last week, 23 brands out of 30 had zero stocks, so even if there is a need, the purchase requirement cannot be fulfilled,” shared Amerasinghe.

He added that burdening the already impacted industry with further risks is not a just move.

“Asking the importers to bear the risk is not at all fair, since we are not aware when the ban will be lifted. This will impact our financial position,” Amerasinghe stressed.

While there are stocks of smaller unregistered vehicles, the CMTA representative said it does not make economic sense for vehicle permit holders to use the concession 
for such purchases.

In doing so, the permit will not be utilised to its full potential since the value of the vehicle is lower than the concession itself.

The government’s decision was also met with resistance by the Government Medical Officers’ Association (GMOA), which has been vocal about issues relating to vehicle permits even in the past.

In a letter sent to the Treasury this week, the GMOA called on the government to carry out a survey to find out the exact number of vehicles that would be purchased with the 
existing permits. 

 It also suggested the need to conduct a qualitative survey regarding the minimum quantity and the standard of the 
eligible imports.

While requesting the implementation of a standard method to control vehicle prices, the GMOA called for the value of the duty concession of the permit to be upgraded so that the disadvantages of the scheme are compensated for.

The Finance Ministry last week said vehicle permit holders who haven’t been able to import vehicles due to import restrictions, can purchase unregistered vehicles already imported to the country from registered vehicle importers/sellers at market price minus the tax concession entitled for such permits.

The ministry further said the registered importers/dealers of vehicles who acquire permits form permit holders by selling their vehicles at reduced prices will be given the tax concessions entitled for such permits when they import vehicles in future.