The Government yesterday announced that the import tax on ethanol used for manufacturing disinfectant liquids, reduced during the COVID-19 pandemic, has been increased to its previous levels amidst accusations of irregularities in ethanol imports.
“With this move, the Government expects to collect tax revenue of Rs. 1.6 billion,” State Minister of Finance Ranjith Siyambalapitiya said.
How ever the government has drawn special attention to the quantity of ethanol imported for use in Sri Lanka and the lack of proper regulation of importing institutions.
The Import and Export Control Department officials were instructed to submit a report to the Committee within two weeks containing the procedure for issuing licenses for the importation of ethanol into the country by various companies, information on each of these companies, and the quantity of ethanol imported by those companies.
At the height of COVID-19 pandemic, ethanol was imported to the country in large volumes to manufacture disinfectant liquids. Accordingly, the import tax on ethanol was reduced on two occasions on 30 April and 9 June 2020.
Separately, the Government has decided to raise the tax on toddy from Rs. 25 per litre to Rs. 50 per litre.
Justifying the move, State Minister Siyambalapitiya said the tax was hiked once again as the vendors did not pass on the reduced tax benefit to the consumers.
The Committee on Public Accounts recently (08) drew special attention to the quantity of ethanol imported for use in Sri Lanka and the lack of proper regulation of importing institutions.
The government also inquired into the issuance of licenses for the importation of vehicles and spare parts to Sri Lanka.
Although it had previously instructed to take the necessary steps to formulate a proper procedure in coordination with the Department of Motor Traffic, but no action had been taken in this regard.
It has been revealed that the lack of proper coordination with the Direct Liaison Institutions such as the Excise Department, the Department of Motor Traffic and the Sri Lanka Customs is very problematic in conducting the activities of the Department and was instructed to take the necessary steps to do computer networking immediately.
To this end, the importance of liaising with institutions such as the Information and Communication Technology Agency of Sri Lanka (ICTA) and the Telecommunications Regulatory Commission was also emphasized.
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