ECONOMYNEXT - Sri Lanka has cut taxes on small cars with engines capacity below 1,000 cubic centimetres but upped taxes on larger cars, motor trade officials said.
A Nissan X-Trail were taxes were earlier about 4.6 million rupees had gone up to 7.9 million which may push the street price to 10 to 11 million rupees, an importer said.
The tax on an Outlander which was about 5.4 million had now gone to 7.96 million rupees. The retail price may move close to 13 million, sources said.
A mid-sized Axio hybrid which had a tax of about 2.8 million would now draw a tax of 3.0 million rupees. The prices of Aqua and Fit cars will also go up.
The taxes on a Wagon-R which was about 1.5 to 1.6 million would now come down to about 1.35 million, sources said.
However auction prices in Japan had already started to move up on small cars.
The auction prices on larger cars can also come down, when import demand falls.
Secondary market price tax free permits of the elected ruling class and state workers will also go up, giving them more tax-arbitrage profits.
A permit which a member of parliament could sell at about 20 million rupees up to yesterday, may now go up to about 30 million or more depriving tax to the state. From secondary market prices are not yet available. (Colombo/May27/2016).