A revelation about rising imported vehicle prices

The Vehicle Importers Association of Sri Lanka (VIASL) has announced the potential increase in vehicle prices in the future, following the government's decision to impose a 50% surcharge on vehicle imports. The association points out that due to the combined effect of the new surcharge, the increase in foreign exchange rates, and existing taxes, vehicle prices will increase by a range of Rs. 1.5 million to Rs. 2.5 million, depending on the model.

Mr. Usman Ali, Secretary of the Vehicle Importers Association of Sri Lanka, stated that their association never anticipated such a heavy tax burden on vehicle imports, and he warned that the mandatory impact of this would have to be borne by consumers. He further mentioned that the exchange rates of the US Dollar, Japanese Yen, and British Pound have already increased, and in addition to this, the government has introduced this new 50% surcharge against the backdrop of having already increased the Social Security Contribution Levy (SSCL) by 2.5%.

According to industry estimates, price increases under various vehicle categories are significant. Accordingly, under the Mini Cars/Kei Cars category, the price of an Alto/Carol will increase by Rs. 421,750, an Alto/Carol Hybrid by Rs. 542,250, a WagonR/Flair by Rs. 482,000, and a WagonR/Flair Hybrid by Rs. 602,500. Furthermore, it has been calculated that the price of the Dayz Highway Star model will increase by Rs. 662,750 and the EK X model by Rs. 723,000.

Considering the Compact Cars category, the price of a Passo/Boon is expected to increase by Rs. 542,250, a Yaris by Rs. 602,500, and an Axio Hybrid by Rs. 903,750. Additionally, prices of vehicles in the SUV and Hybrid SUV categories will also increase significantly, with a Raize/Rocky/Rex Hybrid increasing by Rs. 903,750 and a Vezel X by Rs. 1,084,500. Furthermore, the association indicates that the price of a Vezel Z model is set to increase by Rs. 1,205,000 and a Vezel Z Play model by Rs. 1,325,500.

With this latest tax decision, a significant jump in prices is expected even for small city cars and compact cars, and the Vehicle Importers Association warns that the existing problems regarding people's ability to purchase a vehicle will be further intensified. There is likely to be a strong debate in the future as to whether this government measure is aimed at protecting foreign reserves and increasing state revenue, or if it risks imposing a further heavy burden on consumers who are already facing rising living costs.