Tea Board to test all teas at tea auction for sugar

• Tea industry regulator to adopt baseline sugar contents for all tea types within 2 months
• Detection of sugar above baselines will result in legal action being instituted against factories 
• Islandwide raid early this year found 53 tea factories had adulterated their teas with sugar

By Nishel Fernando

The country’s tea industry regulator, the Sri Lanka Tea Board (SLTB), has decided to conduct tests on all teas coming into the Colombo Tea Auction, to ensure the quality of Ceylon Tea and most of all, to certify that sugar is not used during the manufacturing process, a senior SLTB official told Mirror Business. 

The Tea Research Institute of Sri Lanka (TRISL) recently has come out with baseline sugar contents for individual tea types, following almost one year of studies and research. 

The TRISL is currently conducting field trials and the SLTB is confident that the baselines will be established within two months. 

In an islandwide raid carried out early this year, the SLTB found that 53 tea factories had adulterated their teas with sugar. 

However, due to the absence of baseline sugar contents, the SLTB was unable to proceed with legal action against these errant factory owners.

“Once we set up the baselines, we can find out the actual content of sugar in tea. If this is higher than the baselines, it will be considered as contaminated with sugar and based on that, we will take legal actions,” the SLTB official, who requested anonymity, said.

The official stressed that the baseline for final black tea would be vital in testing the finished teas at auction level.

“We will test them at auction level and we won’t allow these teas to go through the auction if they are found to be contaminated,” the official noted.

The SLTB currently conducts weekly tests on randomly selected 4,000 tea samples at the Colombo Tea Auction. 

Speaking to Mirror Business, SLTB Chairman Lucille Wijewardena also confirmed that the SLTB would soon adopt these baselines in order to take legal action against the alleged tea factories and to ensure the quality of Ceylon Tea. 

Plantation Industries Minister Navin Dissanayake earlier said that he would take firm actions against any errant factories involved in this practice, by suspending their licences or even shutting down those tea factories.

Dissanayake also had said too many licences were issued to set up tea factories over the past 15 years, which he stopped when he became the minister. The number of tea factories in the country as of now stands at 740.

Cabinet decides to remove variable cess on tea stock exports 

The tea exporters yesterday welcomed the Cabinet decision to impose a fixed cess tax of Rs.10.00 per kilogramme on stock exportation of tea, removing the existing variable cess tax on tea exports above 10 kilogrammes, stating that the move would make Ceylon Tea more competitive in the international market. 

The Cabinet on July 10 approved the proposal presented by Plantation Industries Minister Navin Dissanayake to impose a fixed cess tax of Rs.10.00 per kilogramme on stock exportation of tea.

Speaking to Mirror Business, Tea Exporters’ Association Chairman Jayantha Karunaratne said, “We welcomed the move as exporters because we will pay less cess to the Treasury, which will help us to be more competitive exporters.”

He noted that the exporters were subjected to a 2.5 percent variable cess per kilogramme of over 10 kilogramme stocks of tea exports on previous month’s Colombo Tea Auction price, which is in addition to the promotional and marketing levy of Rs.3.50 per kilogramme.

According to last month’s tea auction averages, the 2.5 percent cess amounts to Rs.15.00 per kilogramme. 

However, the tea export stock below 10 kilogrammes was only subjected to Rs.4.00 fixed cess.

Karunaratne also revealed that Dissanayake has also agreed to reduce the promotion and marketing levy by 50 percent by end of this year and to completely remove it by end-2019.

“Due to the high levy, the exporters find it difficult to carry their promotional and marketing activities abroad. 

Once the levy is reduced and eventually removed, the exporters will be able to utilise some of these funds for promotional and marketing activities of their companies,” he pointed out.