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“Govt. to partially relax vehicle import ban”

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The Government is set to partially relax the vehicle import ban that has been in place since 2020, says First Capital Research.

“With this move, the government is planning to lift restrictions placed on small cars with engine capacity of 1,000CC and 1,300CC.”

The move to relax small vehicle imports come in the wake of limited revenue collection by Sri Lanka customs (approximately falling short by RS. 300.0 bn – RS. 450.0 bn), on the backdrop of stringent revenue targets set by the IMF.

“Prior to the ban on vehicle imports, Sri Lanka had new vehicle registrations of over 350,000 annually, of which majority was dominated by motorcycles ( over 280,000) whilst Cars came in second with over35,000 new registrations annually,” First Capital Research stated.

Considering the pent-up demand in the system on the back of outstanding permits given to government officers, we believe that the lifting of the ban on small vehicles under 1,300CC will trigger new registrations between 10,000-15,000 in the next 2 years (new registrations of small car imports less than 1,000CC amounted to 26,962 in 2019 and 64,195 in 2018).

This move is expected to boost the prospects for Diversified Financials given that 57.3% of the loan book in the sector is exposed to the leasing business.

Taming down in interest rates together with the pickup in economic activity in the country is also expected to aid leasing volumes, after Govt. partially relaxes the prevailing import ban.

“However, steep depreciation of RS. and recently implemented taxes are expected to cause headwinds to the expected growth in volumes,” the report added.

No final decision on car imports

State Minister of Finance Shehan Semasinghe said yesterday that the Government has not yet reached a firm decision on lifting the ban on private motor vehicle imports.

He said that the prime focus of the Government is to uphold economic stabilisation at an acceptable threshold and added that this cautious approach was being taken to safeguard the economic gains achieved so far.

(sundayobserver.lk)

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Three injured in Kosgama shooting, including 12-year-old girl

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Three people, including a 12-year-old girl, were injured in a shooting incident at Suduwella, Kosgama, early this morning (6), police said.

They said the victims were travelling in a three-wheeler when two individuals on a motorcycle opened fire using a pistol-type weapon.

The injured include a 30-year-old woman and her 12-year-old daughter, both residents of Avissawella, as well as a 44-year-old man.

All three have been admitted to Avissawella Hospital for treatment.

Police said the motive for the attack and the identities of the suspects have not yet been established.

Kosgama Police are conducting further investigations into the incident.

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Four Sri Lankans arrested at BIA with 378 bottles of liquor

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Four Sri Lankan passengers were arrested by Customs officers at the Bandaranaike International Airport (BIA) this morning while attempting to smuggle in a large consignment of whiskey and cardamom valued at approximately Rs. 15 million.

The suspects, residents of Colombo and Hatton had arrived in the country on IndiGo flight 6E-1183 from Bangalore, India, which landed at 1:00 a.m.

Customs officials uncovered the contraband during baggage checks, finding 378 bottles of whiskey and 132 kilograms of cardamom concealed in 20 pieces of luggage. The items were reportedly purchased from a duty-free shopping complex at a foreign airport.

The four individuals have been detained, and further investigations are being carried out by the Airport Customs Division.

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Treasury sounds alarm over vehicle import boom’s dollar drain

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The Treasury has warned the Central Bank that the enthusiasm shown in the import of vehicles after the ban was lifted could have a negative impact on foreign reserves and urged that precautionary measures be taken.

A senior Treasury official said that in the five months after the restrictions on the import of vehicles were lifted, Letters of Credit to the value of US$ 742 million have been opened, against the proposed target of allowing up to US$ 1 billion.

Accordingly, the Treasury has advised the Central Bank that as the opening of the LCs and imports has been at a rate faster than anticipated, it should closely study the trend of imports and take remedial measures in advance.

The Treasury has pointed out that the outflow of US dollars could have a serious impact on the foreign currency reserves and also on the exchange rates. As a result, there could be an impact on imports of essentials, including fuel.

The longstanding vehicle import ban was lifted in February this year, and so far more than 18,000 vehicles have been brought into the country, while import levies have earned a tax revenue of Rs 220 billion, Customs Spokesman Seevali Arukgoda told the Sunday Times.

The revenue from vehicle imports has made a significant contribution to the taxes in the form of customs levies amounting to Rs one trillion so far for the year. The Customs revenue target for this year is Rs 2.1 trillion.

(sundaytimes.lk)

(Except for the headline, this story, originally published by sundaytimes.lk has not been edited by SLM staff)

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