Sri Lanka tax privilege to be given for unregistered vehicles already imported
ECONOMYNEXT – A priviledge given to state workers, denied to ordinary citizens, in the form of a ‘permit’ to slash taxes payable on vehicles would now apply to cars already imported, the Finance Ministry has said amid a wide ranging trade embargo on imports.
The finance ministry said any permit holder would be able to buy an vehicle from a dealer or a domestic assembler at a reduced price reflecting the amount of tax slashed.
The tax off-set could be given by any authorized agent for brand new cars, a vehicle dealer who has a company registered at the Registrar of Companies to import cars or a firm assembling cars in the country.
The relevant taxes would be off-set from any car imported by the firms in the future.
Sri Lanka has banned vehicle imports after the central bank printed large volumes of money in March and April 2020. Private credit has contracted in May and June, but if domestic credit picks, up excess liquidity can still trigger currency pressure, analysts have warned.
In Sri Lanka the ruling class made of state worker get tax slashed cars while the elected ruling class gets completely tax free cars while ordinary citizens have pay taxes in excess of 200 percent for a vehicle, in a feudal serfdom-style tax regime.
Elected members of Sri Lanka’s new parliament are also entitled to tax-free cars under the feudal-serdom style tax priviledge, it is not clear whether the scheme applies to them as well.