Sri Lanka vehicle import ban threatens 100,000 jobs, tax revenues
[20 November, 2020]
As per the decision made by the government, the Vehicle Importers Association of Sri Lanka (VIASL) has urged the Government to reconsider the ban imposed on importation.
Issuing a statement, the Association said it strongly condemns the statement made by an unendorsed Association with very similar abbreviations supporting the motor vehicle ban.
The vehicle import ban in Sri Lanka is threatening 100,000 jobs and 350,000-400,000 dependants as well as a number of industries and services which need mobility and transport, a motor vehicle industry association has said.
This letter is written, because of the Sri Lanka vehicle import ban in April 2020. According to the ban, Sri Lanka will not import vehicles for a year in a move to curb currency outflows. Ministerial cabinet spokesman said, “there are enough and more vehicles at the moment for about a year, as there are sufficient vehicles in the local market.
The country is dealing with a serious currency exchange crisis as a result of the economic impact caused due to the COVID-19 pandemic. So you need to have certain controls where the exchange is concerned”.
Negative Impact on the Economy
The import ban is also losing the government revenue which is being raked in by assemblers through tax-arbitrage, the Vehicle Importers Association of Sri Lanka said.
“As per the calculation carried out by VIASL, around 100,000 direct and indirect employees will have to be made redundant if the ban is to continue further,” the VIASL said.
Vehicle importers provide various employment opportunities ranging from accountants, sales executives, marketing executives, drivers, cleaners, security staff, etc.
“Furthermore, service areas such as clearing agents, interior cleaners, mechanics, car carrier operators, and service centers are directly dependent on the importation of motor vehicles. Vehicle importers, as well as related service providers, have faced severe difficulties maintaining their business premises, paying off bank loans, rent and paying the salaries of their employees.”
Local Assembling Issues:
The association said domestic vehicle assembly has quality issues as well as a loss of tax revenues.
VIASL strongly believes that this process does not add any value to the country’s economy and is merely designed for tax evasion and higher profit.