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Monday February 6th, 2023

Sri Lanka reduces bus fares by over 11 percent; minimum fare down to 34 rupees

Sri Lanka’s private bus service will be unable to function at normal levels until a solution for the fuel crisis is proposed

ECONOMYNEXT – Sri Lanka’s National Transportation Commission (NTC) has reduced bus fares by 11.14 percent, bridging the minimum fare down to 34 rupees, officials said.

NTC Director General Nilan Miranda said the new fares will be effective from August 04 midnight and will only be applicable to provincial and inter-provincial normal/non-luxury buses.

This is the fourth time bus fares were amended in 2022, with the last reform imposed on July 19 with a reduction of 2.23 percent for all bus types, bringing the minimum price from 40 rupees to 38 rupees.

Miranda told reporters on Thursday August 04 that the minister of transport had approved the price revision with the recommendation of the NTC.

The revision was being done for two reasons, he said. With Sri Lanka’s health authorities imposing a restriction in November 2020 limiting the number of people that can be transported in a bus to the available seat capacity, fares were hiked by 20 percent to reduce the loss incurred by the bus services.

“There are four types of bus services. Non luxury/normal buses can take more people than the seating capacity. Semi and luxury buses can take only people according to the seating capacity. But with the health authority recommendation, a regulation was brought in compelling non luxury buses to follow the rule. In order to continue the service, for non-luxury, we made a 20 percent hike in bus fares on November 11, 2020,” said Miranda.

But now, due to the ongoing fuel crisis and buses limiting their services, available buses are carrying more passengers over the seating capacity.

He added that diesel prices being reduced by 10 rupees on August 01 meant another 1.14 percent reduction in addition to the 10 percent, resulting in a total of 11.14 percent reduction in the bus fare.

“With that, and due to the requests from the general public, we recommended and got the permission to reduce 10 percent from the 20 percent increase we gave in 2020,” Miranda said.

“It will be only for normal bus transport,” Miranda said.

The fare for all normal buses, including inter provincial, provincial, buses in the SLTB”s Gami Seriya programme, buses under the student-trasnporting Sisu Seriya programme, and the under Nisi Seriya programme will thus be reduced.

“With that, the minimum bus fare will be reduced to 34 rupees from 38 rupees. It will be reduced on 350 instances [of ascending order in ticket value] and on the 350th instance, which is the highest priced ticket, the price will be reduced to 2,611 rupees from 2,882 rupees.” (Colombo/Aug04/2022)

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Sri Lanka to address SME tax problems at first opportunity: State Minister

ECONOMYNEXT – Problems faced by Sri Lanka’s small and medium enterprises from recent tax changes will be addressed at the first opportunity, State Minister for Finance Ranjith Siyambalapitiya said.

Business chambers had raised questions about hikes in Value Added Tax, Corporate Income Tax and the Social Security Contribution Levy (SSCL) that’s been imposed.

It should be explored on how to amend the Inland Revenue Act, Siyamabalapitiya said, adding that the future months should be considered as a period where the country is being stabilized.

Both the VAT and SSCL are effectively paid by customers, but the SSCL is a cascading tax that makes running businesses difficult.

In Sri Lanka SMEs make up a large part of the economy, accounting for 80 per cent of all businesses according to according to the island’s National Human Resources and Employment Policy.

(Colombo/ Feb 05/2023)

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Sri Lanka revenues Rs158.7bn in Jan 2023 up 51-pct

ECONOMYNEXT – Sri Lanka’s government revenues were 158.7 billion rupees in January 2023 but expenditure and debt service remained high, Cabinet spokesman Minister Bandula Gunawardana said.

In January 2022 total revenues were Rs104.5 billion according to central bank data.

Sri Lanka’s tax revenues have risen sharply amid an inflationary blow off which had boosted nominal GDP while President Ranil Wickremesinghe has also raised taxes.

Departing from a previous strategy advocated by the IMF expanding the state and not cutting expenses, called revenue based fiscal consolidation, he is attempting to do classical fiscal consolidation with spending restraint.

President Ranil Wickremesinghe has presented a note to cabinet requesting state expenditure to be controlled, Gunawardana told reporters.

State Salaries cost 87.4 billion rupees.

Pensions and income supplements (Samurdhi program) were29.5 billion rupees.

Other expenses were 10.8 billion rupees.

Capital spending was   21 billion rupees.

Debt service was 377.6 billion rupees for January which has to be done with borrowings from Treasury bills, bonds and a central bank provisional advance of 100 billion rupees, Gunawardana said.

Interest costs were not separately given. (Colombo/Feb05/2023)

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Sri Lanka’s Ceylon Tea prices down for second week

ECONOMYNEXT – Sri Lanka’s Ceylon Tea prices fell for the second week at an auction on January 31, with teas from all elevations seeing a decline, data showed.

“In retrospect, the decline in prices would be a price correction owing to the overall product quality and less interest from some key importers due to the arrival of cargo at destinations ahead of schedule,” Forbes and Walker tea brokers said.

The weekly sale average fell from 1475.79 rupees to 1465.40 rupees from a week ago, according to data from Ceylon Tea Brokers.

The tea prices are down for two weeks in a row.

High Growns

The High Grown sale average was down by 20.90 rupees to 1380.23 rupees, Ceylon Tea Brokers said.

High grown BOP and BOPF was down about 100 rupees.

“Ex-Estate offerings which totalled 0.75 M/Kg saw a slight decline in quality over the previous week” Forbes and Walker said.

OP/OPA’s in general were steady to marginally down.

Low Growns

In Low Grown Teas, FBOP 1 was down by 100 rupees and FBOP was down by 50 rupees while PEK was up by 150 rupees.

The Low Growns sale average was down by 8.55 rupees to 1547.93 rupees.

A few select Best BOP1s along with Below Best varieties maintained.

OP1                     Select Best OP1’s were steady, whilst improved/clean Below Best varieties maintained.   Others and poorer sorts were easier.

PEKOE                 Well- made PEK/PEK1s in general were steady, whilst others and poorer sorts were down.

Leafy and Semi Leafy catalogues met with fair demand,” Forbes and Walker brokers said.

“However, the Small Leaf and Premium catalogues continued to decline.

“Shippers to Iran were very selective, whilst shippers to Türkiye and Russia were fairly active.”

This week  2.2 million Kilograms of Low Growns were sold.

Medium Growns

Medium Grown BOP and BOPF fell by around 100 rupees

The Medium Growns sale average was down by 33.40 rupees to 1199.4 rupees.

“Medium CTC teas in the higher price bracket witnessed a similar trend, whilst teas at the lower end were somewhat maintained subject to quality,” Forbes and Walker brokers said.

“Improved activity from the local trade and perhaps South Africa helped to stabilize prices to some extent.”

OP/OPA grades were steady while PEKOE/PEKOE1 were firm, while some gained 50-100 rupees at times.

Well-made FBOP/FBOPF1’s were down by 50-100 rupees per kg and more at times.

(Colombo/Feb 5/2023)

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