SAPPTA urges govt. to do away with export cess

11 December 2015 06:30 pm

Expresses concern on tax being re-imposed as line ministries not entirely in favour 

By Shabiya Ali Ahlam
The apex industry body for spices yesterday commended the government for its move to eliminate export cess, but expressed fresh concerns on tax likely being re-imposed given that the proposed national budget has undergone a number of changes since its announcement.

“While our request to remove the export cess on spices has been incorporated in the budget, we learn there is a bit of re-thinking as the line ministries are not entirely in favour of the removal. We urge the government to do away with the cess entirely so that there is a psychological impact on the farmers to increase production,” said Spices and Allied Products Producers’ and Traders Association (SAPPTA) Founder Chairman Gulam Chatoor.

He elaborated that if the industry is to increase exports, in keeping with the government’s policy, efforts have to be made in making the landscape increasingly productive for farmers, and the removal of the cess imposed by the previous regime is a way forward.Noting Sri Lanka accounts for 10 percent of the world’s spice production Chatoor said: “Even if we double the quantity we can market it. It is necessary for the cess to be completely removed so prices and production can increase which will improve exports.” 
Meanwhile, SAPPTA Chairman Vernon Abeyratne opined the removal will be an incentive for the producer and will allow exporters to be compete better with 
other origins.

“We will be able to offer our products cheaper than other origins and have a better market.  “While the government is looking to double the export income in the next five years, the removal of cess will help farmers increase their production and we will be able to expand our reach in other competing countries,” 
Abeyratne said.
Pointing out that that Sri Lanka is the only country that imposes cess on exports, even on products as simple as spices, the association’s immediate past Chairman M. C. M Zarook stressed it is the farmer who is negatively impacted as the cost is passed down the chain.
“For us to be competitive our cost must be less. Even though our cost of production is low, our cost of exports is high. This cess should be removed,” 
he asserted.