Mini Budget Today 29Th January

[Galle]

According to finance ministry site, present depreciating table is off for all vehicles, and hybrid taxes will increase tonight...

Revision of Vehicle Taxes

8.17 In order to encourage low income families to purchase a motor car to improve their

living standards, I propose to reduce the taxes applicable on the motor cars with engine

capacity less than 1,000 cc by around 15%. 28

8.18 The present tax structure on motor vehicles has created an unhealthy disparity between

hybrid and normal motor cars. In order to rectify this anomaly, I propose to revise the

excise taxes applicable on hybrid vehicles. These changes will be implemented from mid

night today.

8.19 The present practice of depreciating the value of vehicles at the point of import has

created many mal-practices, including under valuation of vehicles and changing the date

of registration. This has led to a significant amount of revenue loss to the government.

As a solution for this, I propose to remove the depreciation Table with effect from mid

night today.

This is correct and proposal is listed under "Tax Revenue Proposals" so we can't expect any tax reduction.

Can anyone explain below point, what will be the effect ??

"8.18 The present tax structure on motor vehicles has created an unhealthy disparity between

hybrid and normal motor cars. In order to rectify this anomaly, I propose to revise the

excise taxes applicable on hybrid vehicles. These changes will be implemented from mid

night today."

[The Don]

If older vehicles are not depreciated before applicable taxes calculated, there is no point of buying older vehicles? Can somebody clarify that please if my interpretation is correct used car importers will be run out of business!!!

As for hybrid taxes it sounds like some of the concessions provided will be removed. The detail is not in the statements you have quoted above.

[Crosswind]

The buying price for older vehicles will be lower. Let's say a zero mileage Donkey costs JPY 2,500,000. An older Donkey may cost around JPY 2,300,000

But the taxes for both donkeys would remain same. without the depreciation table.

[VVTi]

But Sardines, milk powder and maalu paang are less of a cost now... so is mUng Eta... aren't the thel hingannas happy about that?

Edited January 29, 2015 by VVTi

[iRage]

If older vehicles are not depreciated before applicable taxes calculated, there is no point of buying older vehicles? Can somebody clarify that please if my interpretation is correct used car importers will be run out of business!!!

As for hybrid taxes it sounds like some of the concessions provided will be removed. The detail is not in the statements you have quoted above.

That does seem to be the case. You will not receive any tax benefit for bringing down an old car. The only benefit you would get is the little amount you might save in the purchasea price. Tanzania had a similar system were old and new cars got he same tax amount. However they made things complicated by having a valuation table where a vehicle would increase in value and a tax table where the ax rate lowered as the vehicle got older

Howcome everyone is over looking the fact that it is now Rs. 4000/= cheaper to get hitched !

[asrock]

But Sardines, milk powder and maalu paang are less of a cost now... so is mUng Eta... aren't the thel hingannas happy about that?

No the typical thel higannas does not care about food, they only think about their thel and their donkeys

[Rohnd]

No the typical thel higannas does not care about food, they only think about their thel and their donkeys

I have a question?. Are these food reductions for Deshapremee ?. like Wall Clocks & Sil redi. Cars for Deshadrohee ?

[VVTi]

I have a question?. Are these food reductions for Deshapremee ?. like Wall Clocks & Sil redi. Cars for Deshadrohee ?

Depends if you are a Sil redi wearing Hybrid Driving Royal Subject type... are you? A citizen or a subject?

[Crosswind]

Howcome everyone is over looking the fact that it is now Rs. 4000/= cheaper to get hitched !

Here's a better idea. Get five chicks pregnant every month and u will get a steady income of 100,000 a month

and its tax free too ...

Edited January 29, 2015 by Crosswind

[The Don]

Here's a better idea. Get five chicks pregnant every month and u will get a steady income of 100,000 a month

and its tax free too ...

Machang the flaw in your plan is its paid to the woman

[VVTi]

Machang the flaw in your plan is its paid to the woman

Not a big problem for a well adjusted man to live off the woman...

besides he will be able to buy more MIlk Powder and Sardines and kaali miris and koththamlli... plus might be able to afford the rental for a less than 1000cc car...

[Ruslan]

It seems you cannot import Vehicles on individual basis anymore. One needs to pay 1.5 mil and needs to get a license.

[CREATIVE]

hybrid taxes are increased to 80% from 57% .. minimum 5 laks will go up

Edited January 30, 2015 by CREATIVE

[iRage]

It seems you cannot import Vehicles on individual basis anymore. One needs to pay 1.5 mil and needs to get a license.

Did it explicitly state that ? What I read just said that vehicle importing companies irrespective of what kind of vehicles they import will be annually taxed Rs 1.5 mil and had no mention about a licence.

[vishkid]

Did it explicitly state that ? What I read just said that vehicle importing companies irrespective of what kind of vehicles they import will be annually taxed Rs 1.5 mil and had no mention about a licence.

Yeah, that point is not clear. But what's clear is that an 'importer/salesman' importing 5 cars will be charged 1.5M as is a one importing 500. So it's obvious how it will affect the smaller importers. A couple of proposals regarding vehicles are beneficial towards the agents and large scale vehicle importers. Not so for others.

[CREATIVE]

Yeah, that point is not clear. But what's clear is that an 'importer/salesman' importing 5 cars will be charged 1.5M as is a one importing 500. So it's obvious how it will affect the smaller importers. A couple of proposals regarding vehicles are beneficial towards the agents and large scale vehicle importers. Not so for others.

Seems like Ravi got caught to a good offer from large scale car importers.. I heard owner of Ishara or Indra traders have strong links with Ravi..

[matroska]

But Sardines, milk powder and maalu paang are less of a cost now... so is mUng Eta... aren't the thel hingannas happy about that?

For people to be truly happy the price of Hoppers should go down as well..

[B2Spirit]

But the gazette abt depreciation is interesting as valuation differs for brand new cars and used cars.

http://www.customs.gov.lk/tariff/deptbl2015i.pdf

According to tht the valuation for used vehicles will be purely based on FOB(transacted value) whereas for brand news its either agent value or FOB.

If that is correct its really playing in to the hands of used car importers as custom will hv no say in valuation and undervaluing will be rampant as it will be hard to implement checks and balances on that.

Edited January 30, 2015 by B2Spirit

[Ruslan]

Well, Well, Thel Higannas wet dreams were over it seems.. Hybrid taxes were raised to 80%

http://www.customs.gov.lk/tariff/exsp2015i.pdf

[vishkid]

Preferential rate structure applicable to Hybrid cars to be removed.(Excise (Special provisions) Duty on Hybrid

vehicles increased to 150% from the current 50% [with effect from midnight 29/01/2015]) [source PwC]

[CREATIVE]

Preferential rate structure applicable to Hybrid cars to be removed.(Excise (Special provisions) Duty on Hybrid

vehicles increased to 150% from the current 50% [with effect from midnight 29/01/2015]) [source PwC]

this is incorrect.. according to custom website tax increased to 80% not 150% previous 150% for below 1000CC has gone down to 135%

[iRage]

***DELETED POST...some others have brought up the same issue + document

Edited January 30, 2015 by iRage

[CREATIVE]

But the gazette abt depreciation is interesting as valuation differs for brand new cars and used cars.

http://www.customs.gov.lk/tariff/deptbl2015i.pdf

According to tht the valuation for used vehicles will be purely based on FOB(transacted value) whereas for brand news its either agent value or FOB.

If that is correct its really playing in to the hands of used car importers as custom will hv no say in valuation and undervaluing will be rampant as it will be hard to implement checks and balances on that.

seems like have to go-through normal valuation process of the customs.. That means indirectly the depreciation is still there. It will be depreciated from the FOB value..

[iRage]

seems like have to go-through normal valuation process of the customs.. That means indirectly the depreciation is still there. It will be depreciated from the FOB value..

You mean the depreciated value will be the FOB value + other charges. Not depreciated FROM the FOB value which could also be interpreted as taking a certain % of the FOB value as the valuation. As someone else pointed out before....

1) our public loving socially responsible car salesmen are going to be forging invoices and devaluing purchase prices left and right

2) the three vehicles I have helped/involved myself over the last three years the valuation of the cars have been greater than the actual FOB

so this whole lack of a depreciation table might be a can of worms....unless there is a whole lot more to the story that we still do not know.

[Wasa]

this is incorrect.. according to custom website tax increased to 80% not 150% previous 150% for below 1000CC has gone down to 135%

this is incorrect.. according to custom website tax increased to 80% not 150% previous 150% for below 1000CC has gone down to 135%

earlier tax for hybrids 70% ???

That means taxation costs another 10% from today for zero mileage used hybrid. & same for even nearly two years old one as depreciation table is no more.

Any comment please....