Mini Budget Today 29Th January

[iRage]

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....

What they use for valuation for used cars is now apparently the FOB value + other charges (look prior comments and documents linked); so no here will be a difference in tax for used and brand new cars.

Earlier tax for Hybrids was 57.5% (or something like that)

[GTAm]

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's correct Don. The previous budget brought that about for non-hybrid cars. So as to discourage imports of used cars and direct everyone to Micro

[iRage]

That's correct Don. The previous budget brought that about for non-hybrid cars. So as to discourage imports of used cars and direct everyone to Micro

Not really....according to the customs document they use the FOB price for valuation; so taxes will still be lower for used cars ?

[GTAm]

Not really....according to the customs document they use the FOB price for valuation; so taxes will still be lower for used cars ?

Not in my experience. Every importer never ever states the correct value on a used car. The duty is calculated on the brand new CIF price even for used cars. The depreciation for a one year old car (which the tax payers permit qualifies for) was taken off at the last budget.

[iRage]

Not in my experience. Every importer never ever states the correct value on a used car. The duty is calculated on the brand new CIF price even for used cars. The depreciation for a one year old car (which the tax payers permit qualifies for) was taken off at the last budget.

Like I said before..I am just saying what 1B of the customs document http://www.customs.gov.lk/tariff/deptbl2015i.pdf; which seems to suggests that the valuation of the car would be the FOB value and then they start adding other charges which are applicable for both brand new and used cars (items 2,3,4,etc..).

and like some others and I have sated before it is opening up a can of worms with undervalued FOBs etc...and the customs having no say on the actual value.

Last night I too was under the impression of what you suggested thus my earlier response to The Don't question siting what the Tanzanians did ..but then this document showed up this morning

Edited January 30, 2015 by iRage

[raththaran]

Can somebody describe this new tax change and how it compares to the old scheme in layman's terms? And how it will affect future car buyers.

[Ruslan]

I see Bright future ahead for Car sale people. seems like list of importers decided by Motor Vehicle Importers Association.

http://www.lankabusinessonline.com/news/sri-lanka%E2%80%99s-government-taxed-individual-car-importers/55096555

Edited January 30, 2015 by Ruslan

[Watchman]

Can somebody describe this new tax change and how it compares to the old scheme in layman's terms? And how it will affect future car buyers.

Everyone here are laymen.

In the simplest form:

Under 1000cc price does DOWN

Hybrid prices go UP.

[VVTi]

I see Bright future ahead for Car sale people. seems like list of importers decided by Motor Vehicle Importers Association.

http://www.lankabusinessonline.com/news/sri-lanka%E2%80%99s-government-taxed-individual-car-importers/55096555

I see nothing wrong with it.

If you really look at it, this might save a few people from bankruptcy.

[B2Spirit]

I can understand them promoting agents and brand new cars through these changes because they are affiliated to the manufacturer and pay a fee to them. And thats how most other countries work. But when it comes to used cars and their importers the changes sound fishy.

We all know how the car sales guys used to rip off masses when buying cars in the past. This will just make it legal for them to do that again and people will not hv any alternative.

If you look at it technically, personal importer or a car sales guy does not have any difference as they just buy used cars and ship it here. Car sales are not affiliated to car companies nor they provide anything extra. So it is unfair to create a divide and say these big sales can import while others can't.

It is basically creating a cartel through legal means that make it financially unviable for small fish to operate.

Edited January 30, 2015 by B2Spirit

[Rumesh88]

I see Bright future ahead for Car sale people. seems like list of importers decided by Motor Vehicle Importers Association.

http://www.lankabusinessonline.com/news/sri-lanka%E2%80%99s-government-taxed-individual-car-importers/55096555

A bright future it is, for all those who stockpiled hybrids!

[Ruslan]

I can understand them promoting agents and brand new cars through these changes because they are affiliated to the manufacturer and pay a fee to them. And thats how most other countries work. But when it comes to used cars and their importers the changes sound fishy.

We all know how the car sales guys used to rip off masses when buying cars in the past. This will just make it legal for them to do that again and people will not hv any alternative.

If you look at it technically, personal importer or a car sales guy does not have any difference as they just buy used cars and ship it here. Car sales are not affiliated to car companies nor they provide anything extra. So it is unfair to create a divide and say these big sales can import while others can't.

It is basically creating a cartel through legal means that make it financially unviable for small fish to operate.

Yes, what Gov. should have done is that, not just prepare the means to fill some Mudalalis pockets. Might be a Rumour, but some say there's a connection between Finance Minister and Major car sales guys. and he played to their hands.

[iRage]

We all know how the car sales guys used to rip off masses when buying cars in the past. This will just make it legal for them to do that again and people will not hv any alternative.

If you look at it technically, personal importer or a car sales guy does not have any difference as they just buy used cars and ship it here. Car sales are not affiliated to car companies nor they provide anything extra.

USED to ? When did they stop ?

How can you say car sales do not provide anything extra ? It takes a lot to take that R grade car and turn it in to a glittering head turner ...With this mini budget we have missed another point...this also mean that every Sunday the H*tad issue is going to have less pages, thus seriously reducing income of such publishes.

Since we are all locked in to these few loving socially responsible car salesmen; would their be something like lemon laws or any other consumer protection mechanisms introduced in case these guys sell us utter rubbish ? <okay that was a rhetorical question>

On a serious note...I wonder if the agents would get in to the used car sales again.I remember for a short short period of time long ago when Toyota had newly moved in to their new offices in Wattala they had a few Toyota U-Car units, which were Toyota Certified, for sale.Didn't the Nissan agent also used to do this ?

[asrock]

On a serious note...I wonder if the agents would get in to the used car sales again.I remember for a short short period of time long ago when Toyota had newly moved in to their new offices in Wattala they had a few Toyota U-Car units, which were Toyota Certified, for sale.Didn't the Nissan agent also used to do this ?

Afaik A*W is still doing that, I remeber they had few A*W certified used Nissan and Suzuki cars in a show room.

[priyanka]

Everyone here are laymen.

In the simplest form:

Under 1000cc price does DOWN

Hybrid prices go UP.

according to a clearing agent those who have ordered aqua will have to pay 700,000 in addition, prius around 1 million, and for vezzel over 1 million.

(not confirmed yet.......)

[Crosswind]

I wonder what will happen to the price of used sardine tins... Will they go up or come down?

[Rumesh88]

I wonder what will happen to the price of used sardine tins... Will they go up or come down?

All the sardine tins have suddenly disappeared from ad pages . OMG what's going on. According to a car sales guy I was having a chat with a while ago price of an Axio would go up by 700,000.

[The Don]

Personally I do not accept the justification put forward to abolishing the depreciation table. The depreciation table does not depend on value. It merely depends on time. The value is fixed, for the same model for brand new and reconditioned vehicles and is provided by the agent. So in real terms its a tax increase on used automobiles dressed up as a technicality to reduce corruption/ inefficiency.

I don't think you should ban personal imports. There is no logical reason to ban it apart from to benefit dealers.

Also in real terms it makes buying a car brand new from the agents more attractive.

[The Don]

I wonder what will happen to the price of used sardine tins... Will they go up or come down?

Scrap metal prices sadly remain stable...

[Asela.net (MIB_SriLanka)]

Saw this going around in Elakiri site Seems like some one got it from FB but not sure this is true or not

[iRage]

I dunno....hard to take most things on EK as legitimate. In that table...what is the column that says 100% ? Is it the percentage of the car you can purchase ?. ...Why just a WILDFIRE and not the Alfart as well ? So uhh..VOXCEY and NOHA costs less than a Prius ?

[xlr8r]

No more depreciation now.. that's why the 100% column

This table is mostly true unfortunately...

Not sure what these idiotic Gov. thinking increasing only Hybrid duty and reducing non-Hybrid duty

[Crosswind]

What this idiotic government thinks is there are millions and millions of people in this country who can't afford two square meals a day. They need to given some kind of relief. Although personal I may be adversely affected by some budget decisions, I still support it. So who r the idiots? The government or the thel hingannas who can't afford another hybrid car to make their neighbor envious?

Edited January 30, 2015 by Crosswind

[B2Spirit]

With the hike I believe SL is also following other countries.

In those countries how hybrids are promoted is that hybrids are provided tax breaks or incentives so that they are made price competitive with non-hybrids.

Only thing hard to swallow in this hike is some of this will go into paying salary hikes of mostly unproductive govt employees which is unfortunate.

And the public sector is seriously bloated thanks to previous govt.

There are employees just sitting around in canteens and doing nothing.

And some of the offices are so overstaffed that new employees doesn't even have workstations.

Pouring money in to that type of environment is loss-loss for everybody.

Note : I am saying 'Most' not "All"

[iRage]

I am with Crosswind on this....there are a 101 other things we should be worrying about than car taxes (eg. what I hear and aid proposals I read about the education and health system from donors is quite sad).