VEHICLE TAX INCREASE WAS TO CURTAIL IMPORTS:GOVT.
Controlling of vehicle imports was extremely necessary as there was a vast increase of motor vehicle imports since 2009 which was also contributed to increase the fuel bill giving a negative impact to the balance of payment
The government yesterday claimed the recent tax increase on motor vehicle imports was aimed at curtailing the influx of vehicles as the country's road network cannot sustain the ever increasing number of vehicles put into roads daily.
Cabinet spokesman, acting Information and Media Minister Lakshman Yapa Abeywardana told the weekly cabinet news briefing that the people would accept the tax increase in times to come as usual and government had no intention to make changes in the tax regime imposed on vehicle imports.
A 1000 CC car would be subjected to a duty at the point of import of 200% as against 120% earlier. Petrol- driven three-wheel- ers would have to pay 100% of the value as against the previous 51%. According to the Treasury, vehicle imports have gone up from 3,421 units in 2009, to 37,134 units in 2010, and to 54,285 units in 2011.
"Controlling of vehicle imports was extremely necessary as there was a vast increase of motor vehicle imports since 2009 which was also contributed to increase the fuel bill giving a negative impact to the balance of payment. Therefore, some sort of control on vehicle imports was a necessary move by the government," he said.
Minister Yapa said the reconditioned vehicle market that had been hit since Saturday following the imposition of new taxes would pick up shortly as usual.
"It is common that motorists restrict their use of vehicles every time when there was an increase fuel prices. But the things turn normal after a few days or week and people start using vehicles once again. The slow moving of vehicle market is temporary and people would start purchasing vehicles to the new prices,' Minister Yapa said.