The Vehicle Importers’ Association of Lanka (VIAL) commended the efforts taken by the government to simplify the tax structure for imported vehicles and moving away from value-based to a unit-based tax system, at a post-budget press conference held by the association.
The Association welcomed the proposal to reduce the tax on electric cars which it says will help mitigate environmental pollution and reduce the drain of foreign exchange on fossil fuel.
“We are pleased with the measures taken to promote electric cars which we have been lobbying for since 2008. There were many who opposed importing electric cars. However, it has been proved successful and the first such car is still in good condition,” VIAL President Indika Sampath Merenchige said.
However, vehicle importers said the tax reduction on electric vehicles is not a practical move, as Japanese manufacturers will not release such vehicles to agents in Sri Lanka due to the absence of a proper infrastructure to maintain electric vehicles in the country.
The Association also criticised the government for denying those who were eagerly waiting to go for an affordable vehicle with tax reductions.
A spokesman for VIAL said the latest proposals of the 2018 Budget may result in price increases of vehicles such as Aqua, Axio, Premix, Allion, Prado, Toyota Pries (Hybrid) while the prices of an Alto could drop by around Rs.100,000.
The Association also said that the prices of Toyota Axio, Toyota Aqua, Honda Velez and Honda Grace will go up by around Rs. 750,000 following the increase in the taxes.
However, VIAL also noted that the price of Suzuki Wagon R, Toyota CH-R, Toyota Vita 1000 CC and Nissan Leaf will come down.
VIAL Secretary Earthy Gunawardana said the Association commends the measures proposed to ban the import of vehicles that do not have airbags, anti-locking breaking system/ABS and three-point seat belts.
The move to ban the import of such vehicles will come into effect from January 1, 2018.
However, VIAL said there could have been better measures for the benefit of all in the industry had the proposals made to the finance ministry before the budget been taken into consideration.
“We were not given an opportunity to express our views during the preparation of the budget,” Merenchige said.
However, a letter from the finance ministry assuring that it would take into consideration the proposals made by the vehicle importers association was read out by a VIAL official during the media briefing.