Government planning to export locally produced brown sugar: Handunnetti

Colombo, June 1 (Daily Mirror) - The government is planning to export locally produced brown sugar as a move to raise the revenue of local sugar factories and thereby to protect the employees and sugar planters, Minister of Industry and Entrepreneurship Development Sunil Handunneththi said today.

He told a news conference at the Government Information Department that the 18 percent VAT is charged on locally produced brown sugar as a IMF condition, whereas imported white sugar is VAT free. 

The Minister said locally produced brown sugar costs Rs. 236 per kilo at the factory and added that imported white sugar only costs Rs. 132 per kilo at the Customs and Rs. 50 as tax is imposed. But no VAT is imposed.

He said the Ministry made several requests from the Finance Ministry to get the VAT reduced but it was not possible due to IMF conditions.

The Minister said the Ministry is seeking options to raise the revenue of the sugar factories so as to protect the factories, their employees and sugar planters.

He said the Ministry is looking to export sugar as one option to raise revenue as locally produced brown sugar is high in organic percentage.

"Our local sugar is high in organic percentage as we use less fertiliser for sugar cultivation. We have discussed with several countries to export our sugar as rich organic sugar. It is unfortunate that we have to export our healthy sugar and import unhealthy white sugar. But, we have to take that decision for the sake of the industry, employees and sugar famers. We need to protect the industry until we can reduce the VAT and provide sugar at low rates in the local market," he said.

He said some media institutions and political forces are trying to sabotage the local sugar factories by creating unnecessary issues and added that neither the employees nor sugar planters are facing issues right now.