The Vehicle Importers Association (VIA) today alleged that the government had created a monopoly for Brand new vehicle importers through this year’s budget by scrapping the concessions which had been given to the used vehicle importers earlier.
The Association Chairman Mahinda Sarathchandra said that the livelihood of more than 600 used vehicle importers and more than 100,000 employees who were benefited from these companies were in a crisis due to the removal of the concessions given to them earlier.
“The government has removed the concessions given to the used car importers in the 2014 budget. This has put our business in a great crisis. Only a handful of brand new vehicle importers have benefitted from this budget proposal and created a monopoly for them in the market,” Mr. Sarathchandra said.
Mr. Sarathchandra said that brand new vehicle importers had misled the government about the used vehicle importers.
“The brand new vehicle importers had misled the government about our business just for their benefit. The 40- year long business we have been doing has come to a stage where we had to close down this business”, he said.
Mr. Sarathchandra rejecting media reports that used vehicle importers engaged in under invoicing and de–registering of vehicles said they had not done anything illegal and said they import re-conditioned vehicles as they have been allowed by the government to do so.
Mr. Sarathchandra also said Vehicle Importers Association had written to the Treasury Secretary Dr. P.B. Jayasundera and President Mahinda Rajapaksa about the plight they have faced due to the budget proposal and were seeking some concession in this regard.
The government changed the depreciation rates applied on customs duty on used vehicles in the 2014 budget.
The tax currently imposed on used vehicles based on value depreciation was 90% for vehicles used up to six months old, 80% for those used from six months to a year, 75% for vehicles used from a year to 18 months and 70% for vehicles used for 18 months to two years. However, according to post-budget rates a 90% tax would be imposed on all vehicles used for up to two years. (Ajith Siriwardana)