Vehicle Taxes Curb Forex Drain In 2016
by Amila Ekanayake
Vehicle levies by the government in 2016 had curbed huge foreign exchange drain caused by vehicle imports, statistics reveal.
Although a staggering 0.7 million vehicles were imported during 2015 this had come down to 0.4 million in 2016.
In 2015-16, to curb a colossal magnitude of foreign exchange being drained out of the country, government revised several import levies along with regulations pertaining to leasing.
Vehicle import expenditure shot up by 51.6 per cent to US dollars 1,360 million (nearly Rs 197.2 billion) in 2015, from US dollars 897 million (approximately 121 billion) in 2014.
Despite the marginal reduction recorded in the expenditure on food and beverages, import expenditure on consumer goods increased considerably due to the significant increase in the importation of consumer durables.
In 2015, expenditure on consumer goods increased significantly by 22.3 per cent to US dollars 4,713 million, mainly due to the 39.1 per cent growth to US dollars 3,086 million recorded in the expenditure on consumer durables, led by higher expenditure on importing personal motor vehicles. Expenditure on the importation of motor cars increased significantly by 47.6 per cent, contributing towards increasing the vehicle import expenditure by 51.6 per cent to US dollars 1,360 million in 2015, from US dollars 897 million in 2014.
The continuation of the concessionary motor vehicle permits for government employees, reduction of taxes on the importation of motor vehicles, especially less than 1000 CC engine capacity and the depreciation of the Japanese Yen, caused the increase in consumer durable imports, especially motor vehicles.
Vehicle levies by the government in 2016 had curbed huge foreign exchange drain caused by vehicle imports, statistics reveal.
Although a staggering 0.7 million vehicles were imported during 2015 this had come down to 0.4 million in 2016.
In 2015-16, to curb a colossal magnitude of foreign exchange being drained out of the country, government revised several import levies along with regulations pertaining to leasing.
Vehicle import expenditure shot up by 51.6 per cent to US dollars 1,360 million (nearly Rs 197.2 billion) in 2015, from US dollars 897 million (approximately 121 billion) in 2014.
Despite the marginal reduction recorded in the expenditure on food and beverages, import expenditure on consumer goods increased considerably due to the significant increase in the importation of consumer durables.
In 2015, expenditure on consumer goods increased significantly by 22.3 per cent to US dollars 4,713 million, mainly due to the 39.1 per cent growth to US dollars 3,086 million recorded in the expenditure on consumer durables, led by higher expenditure on importing personal motor vehicles. Expenditure on the importation of motor cars increased significantly by 47.6 per cent, contributing towards increasing the vehicle import expenditure by 51.6 per cent to US dollars 1,360 million in 2015, from US dollars 897 million in 2014.
The continuation of the concessionary motor vehicle permits for government employees, reduction of taxes on the importation of motor vehicles, especially less than 1000 CC engine capacity and the depreciation of the Japanese Yen, caused the increase in consumer durable imports, especially motor vehicles.