1 week Ago
The Vehicle Importers Association of Lanka (VIAL) calls on the Government to halt the import of new vehicles and permit only quality used-vehicles into the country for the next couple of years as this would assist in the foreign currency and State revenue issue, “We have presented a proposal to the Government to curtail the import of new vehicles and promote the import of high quality used- vehicles which will limit the outflow of US dollars, enable more middle-income earners to purchase a vehicle and enhance revenue to the State,” VIAL, President Indika Sampath Merenchige said. Each year the country sees an outflow of foreign currency to the tune of around USD 1.25-2 billion on the import of cars (Central Bank, 2023).
Merenchige said such a large amount of foreign currency outflow could be channelled to import more used vehicles in good condition. This he said would enable a large number of buyers to purchase a vehicle at a reasonable price. VIAL officials have been urging for a proper national policy that will curtail the dominance of new vehicle imports in the market where only a few importers make the money and a handful benefit from the venture.
“The Association has been eagerly waiting to share its views with the new policymakers to structure an effective mechanism for vehicle imports which should be regulated to create a win-win situation in the industry which would benefit the public and State coffers,” VIAL President said. The ban on importing personal vehicles is expected to be lifted in February. The Government has allocated USD 1 billion for vehicle imports this year.
“If these funds are to be used to import non essential vehicles it will bring discredit to the new regime whose call has been to bridge the gap between the rich and the poor,” Merenchige said. VIAL said many developed countries prefer to import quality used vehicles from countries such as Japan which has good road conditions and save a sizeable portion of their foreign exchange. The Association said importing vehicles that have been used from seven to ten years will bring down vehicle costs by around 70 percent.
VIAL has proposed to import cars and vans that have been in use for seven years, lorries for 10 years and electric vehicles that have been in the running for three years, increase the Euro standard from four to six and fix the mileage for lorries in use to five to ten years at 600,000 km, electric cars that have run 100,000 km and luxury vehicles that have done a 2000 kilometre run. VIAL has also said if component manufacturing is to be developed in the country, the parts should be fully developed and not partially so that a percentage of the units could be exported. “The issue that had stifled the growth of the automobile industry in Sri Lanka is that policymakers in the past permitted importers to do things that did not match or suite the country.
It’s time that we re-fix the problem with sound decisions and a more simplified taxation policy (VAT and Social Security Contribution Levy) to enable the industry to grow and the State to gain as well..
