Tax Free Car Scheme Ends

[Velocity]

Switched Off

31 March 2008 20:49:35

Sri Lanka state worker tax free car scheme ends

Mar 31, 2008 (LBO) – Sri Lanka has terminated a scheme that gave tax-slashed cars to state workers from today and no new applications would be entertained, the finance ministry said.

State workers who have been issued tax slashed import permits but have not opened letters of credit by March 31 would not be able to open letters of credit to import vehicles.

However the permits could be used to buy a locally produced or assembled car.

State workers who have already applied and who qualify for the tax concession would be issued a permit to buy locally produced or assembled car, the finance ministry said in a statement.

Earlier reports said around 17,000 state-workers have applied to import tax-slashed cars.

In Sri Lanka state-workers also get tax free salaries and pensions. Taxes are deducted from private sector workers and their pension fund is also taxed.

After getting thousands of tax free cars, government officials raised vehicle taxes again this year.

Sri Lanka's politicians also get tax free luxury jeeps. Their salaries are also tax free. More than half the tax revenues of the government are spent on salaries and pensions of state workers.

www.lankabusinessonline.com

[Kulunu]

It means person whom hasn't applied for the permit can't get any vehicle.

[madmax]

This is somewhat expected. Even the last time the government stopped the permit abruptly.

Every time the permit is given, they stop the permits after a certain number has met. Otherwise just think what will happen if all the eligible 20,000 or so government servants import cars within a short period as a year or two?

[Kulunu]

Micro can sell some more vehicles from this action.

[madmax]

Micro can sell some more vehicles from this action.

And it'll be one hell of a wait for the customers. Micro is already a good 6 months behind on their existing orders!

[mazdaspeed]

Switched Off

31 March 2008 20:49:35

Sri Lanka state worker tax free car scheme ends

www.lankabusinessonline.com

Well pls excuse me forks for saying this but I’m kind of pleased. It just seems unfair that certain group of people are getting tax exceptions – Politicos DO not need to get a tax free !

I’ve always stressed the point that private firm works also contribute to the economy. We pay huge taxes for everything.

[Ripper]

Well pls excuse me forks for saying this but I’m kind of pleased. It just seems unfair that certain group of people are getting tax exceptions – Politicos DO not need to get a tax free !

I’ve always stressed the point that private firm works also contribute to the economy. We pay huge taxes for everything.

Ditto Bro

[jaga]

Well pls excuse me forks for saying this but I’m kind of pleased. It just seems unfair that certain group of people are getting tax exceptions – Politicos DO not need to get a tax free !

I’ve always stressed the point that private firm works also contribute to the economy. We pay huge taxes for everything.

Yes you are exactly correct MAZDA SPEED. With the same education some are working in a private sector and pay hell of a lot taxes and others are doing much less work in government sector and eligible for duty free consessiion. Not only that the doctors in sri lanka , How they charge from pure citizens for consultation. After all they have taken free education.

Forget everything what about politicians???

[pissa]

Yes you are exactly correct MAZDA SPEED. With the same education some are working in a private sector and pay hell of a lot taxes and others are doing much less work in government sector and eligible for duty free consessiion. Not only that the doctors in sri lanka , How they charge from pure citizens for consultation. After all they have taken free education.

Forget everything what about politicians???

totally disagree!!! before someone comments let it be known that i work for the private sector too...however it should be noted that the gov workers get a pretty low salary compared to the private sector. for example docs (who dont engage in private practice) gets only 25k as starting and even the most senior consultants don't get more than 75. and this is after years of laborious studying and coming up on top in class and doing really well in exams and all...in comparison those of us who dont get qualified for the uni's do some private degree or diploma in 2-3 years join the private sector and get paid more. hardly fair....the gov knows this, however they cannot increase sal's due to lack of funds..so they give concessions for their workers instead...its like hotel companies giving low rates for their employees....

and to disagree with the other point...politicians (morons, scum, filth etc,) will continue to get the permit!!!! its only the gov workers who dont get....

[sampathd]

Isnt this an April Fools Joke???

Ha Ha Ha ......

[jaga]

totally disagree!!! before someone comments let it be known that i work for the private sector too...however it should be noted that the gov workers get a pretty low salary compared to the private sector. for example docs (who dont engage in private practice) gets only 25k as starting and even the most senior consultants don't get more than 75. and this is after years of laborious studying and coming up on top in class and doing really well in exams and all...in comparison those of us who dont get qualified for the uni's do some private degree or diploma in 2-3 years join the private sector and get paid more. hardly fair....the gov knows this, however they cannot increase sal's due to lack of funds..so they give concessions for their workers instead...its like hotel companies giving low rates for their employees....

De

and to disagree with the other point...politicians (morons, scum, filth etc,) will continue to get the permit!!!! its only the gov workers who dont get....

Dear Bro,

Don't say like that. our Engineers are ,Scientists are also havig the same qualifications but they have very limited opertunaties in government sector and even in private sector they are not heighly paid.

75% of male doctors are in here doing private practices.

Don't get upset

[Bugatti]

Well pls excuse me forks for saying this but I’m kind of pleased. It just seems unfair that certain group of people are getting tax exceptions – Politicos DO not need to get a tax free !

I’ve always stressed the point that private firm works also contribute to the economy. We pay huge taxes for everything.

Well Said..!

It's a bout time the madness ended. As tax payers, we have the right to voice our opinions..! is it not..?

[nadskit]

Switched Off

31 March 2008 20:49:35

Sri Lanka state worker tax free car scheme ends

Mar 31, 2008 (LBO) – Sri Lanka has terminated a scheme that gave tax-slashed cars to state workers from today and no new applications would be entertained, the finance ministry said.

State workers who have been issued tax slashed import permits but have not opened letters of credit by March 31 would not be able to open letters of credit to import vehicles.

However the permits could be used to buy a locally produced or assembled car.

State workers who have already applied and who qualify for the tax concession would be issued a permit to buy locally produced or assembled car, the finance ministry said in a statement.

Earlier reports said around 17,000 state-workers have applied to import tax-slashed cars.

In Sri Lanka state-workers also get tax free salaries and pensions. Taxes are deducted from private sector workers and their pension fund is also taxed.

After getting thousands of tax free cars, government officials raised vehicle taxes again this year.

Sri Lanka's politicians also get tax free luxury jeeps. Their salaries are also tax free. More than half the tax revenues of the government are spent on salaries and pensions of state workers.

www.lankabusinessonline.com

Its no joke I also heard it on news in the morning, I opened the LC in Jan and they told me it will take minimum 4 months to get the vehicle coz they said there is a long pending que. Personnaly I dont agree to issuing permits at this stage at all, it will do a great deal of damage to the BOP of the country with so much of US$ going out of the country..Gvt only do these things having the votes in mind they no care a damn about the economy..

Edited April 2, 2008 by nadskit

[jaga]

Its no joke I also heard it on news in the morning, I opened the LCD in Jan and they told me it will take minimum 4 months to get the vehicle coz they said there is a long pending que. Personnaly I dont agree to issuing permits at this stage at all, it will do a great deal of damage to the BOP of the country with so much of US$ going out of the country..Gvt only do these things having the votes in mind they no care a damn about the economy..

Dear Bro,

Intelligent statement. Bunch of flower from me. Two members in my family have got down duty free cars and who are the richest out of others .I tell the same story for them also.Innocent we pay tax for them

[mazdaspeed]

Dear Bro,

Intelligent statement. Bunch of flower from me. Two members in my family have got down duty free cars and who are the richest out of others .I tell the same story for them also.Innocent we pay tax for them

Well now that's a good example.... Jaga and that situ is common for most people - the rich seems to get richer all the time

Most Gov can't afford a car - it's just the rich lot who can use the permit. Doctors do earn a small sum, what about private practice which does not get taxed ????

But guys let's leave this as I feel it's going out of hand - My sincere apologies

[xXx]

Every time the permit is given, they stop the permits after a certain number has met.

I doubt this is the case. These policy makers are very short minded. I won’t be surprised if there was an insider dealing between the government and the ‘locally assembled car manufacturers’

Are Maruti’s considered as locally assembled? Who are the locally manufactures other than Micro?

I sort of agree with what pissa is saying. Salaries in the government sector are quite low unless you are related to a politica.

I too think this permit scheme shouldn’t have been initiated in the first place especially when the countries economy is in dire stage. It’s all cheap political games. Chandrika more or less did the same in an era when the economic growth was negative then went on the scrap the income tax from government workers in a run up to 2001 general elections.

[madmax]

Dear Bro,

Intelligent statement. Bunch of flower from me. Two members in my family have got down duty free cars and who are the richest out of others .I tell the same story for them also.Innocent we pay tax for them

Jaga "Dear Sis" would have been be more appropriate.

[madmax]

I have a different opinion about this. It's upto a certain individual to decide whether to join the government or work for the private sector. There are more than valid points to argue for both sides.

So if you decided to work for the government you will get a permit and a shitty but tax exempt salary! But work work the private sector, you get a good pay and tax. So one should measure all this when starting their careers or even at a stage where you decide your field of expertise you want to go in college.

For example, I didn't want to become a doctor because you have to spend 6 years in med school with dead bodies and stinky patients. So it takes some guts and endurance to become a doc. True they get good money from private practice, but their salary is just 25K. And it takes at least a good 5 years more to build up a rep. Even my mom who's a 25 year veteran doc gets paid less than me who has worked for only 4 years in IT.

So I think people should not turn a shameful eye on for certain privileges they get. The point is different categories of people get different previleges. Docs get permits, IT guys get a good salary even after tax.

In case of politicians, they have the ability to lie, and that's a special talent that not everyone has, and just think who elected them? The people of the country, no point blaming them! Blame the people. And who are the people? Us!

Look at things in a neutral way, and learn to be happy with what you have! and stop blaming others for what you don't have! If you wanted a permit you could've made your way through med school become a doc and got one, or even become a politician (which would have been much easier :-))

PS: Shit this sounds philosophical

Edited April 1, 2008 by madmax

[madmax]

Dear Bro,

Don't say like that. our Engineers are ,Scientists are also havig the same qualifications but they have very limited opertunaties in government sector and even in private sector they are not heighly paid.

75% of male doctors are in here doing private practices.

Don't get upset

Dude only recently that engineers and scientists got private sector jobs. For decades they have been working for the government. Mahaweli was one of the best places for engineers, and the Department of Agriculture had lot of scientists - even though their designation didn't go as "Scientist".

Edited April 1, 2008 by madmax

[Kulunu]

What will happen to persons who approved the permit and haven't open LC?

[GTAm]

Another crazy move. After issuing so many permits, they probably realize that the country really cannot afford it after all. Anyway I'm a bit happy that a locally asembled car can be purchased. But any idea what the local content is? We may not be saving that much forex after all!

[xXx]

What will happen to persons who approved the permit and haven't open LC?

you'll be able to get your hand on a locally assembled vehicle. no imports i'm affraid.

Another crazy move. After issuing so many permits, they probably realize that the country really cannot afford it after all. Anyway I'm a bit happy that a locally asembled car can be purchased. But any idea what the local content is? We may not be saving that much forex after all!

I too doubt that much FX will be saved as the majority of the permit holders will be interested in the Rexton type SUV. My understanding of the Micro operations on this SUV is that they import all the components and all they do is assemble it together. But in an era which economy has hit rock bottom guess every little helps.

[madmax]

Another crazy move. After issuing so many permits, they probably realize that the country really cannot afford it after all. Anyway I'm a bit happy that a locally asembled car can be purchased. But any idea what the local content is? We may not be saving that much forex after all!

I believe it's only the labor component.

[Gummybr]

I believe it's only the labor component.

Actually speaking I am very happy that this happened. Not with a bad meaning.

There have been permit brokers who have been going around spreading rumors that the value of these permits will be increased. And because of that many people have stopped buying hoping to go for better vehicles. With all due respect to the government servants (my father was one, so is my brother now) its a good lesson learnt, never ever trust these permit brokers.

Also this was expected from a long time, how would our economy survive with so much of money going out of the country plus the loss of revenue through taxation.

I've never been a huge fan of the local taxation though cos although they charge this social responsibility levy and road and infrastructure development levy what have they done to this country with that money??

Money will always go out of the country be it legally and illegally. But common you issue about 20,000 - 30,000 permits and imagine the money that will go out of the country and the direct and indirect that affects the people...

But then again I must also condemn the permits given to the MP's (the people who are unworthy of that). Why they have issued 4 - 5 more because of the recent deaths and absentees from parliament. If the others arent given an opprtunity to get a duty free vehicle why should these idiots get a chance of bringing down the top vehicles on their permits??

Getting back to your point GTAm, I also am confused how the duty free scheme can be used to buy locally assembled vehicles...

Do they pay for the parts and forget about the duty, or they pay the CIF value in SL + labour (forgetting the fact that the money will again be remitted back)

Edited April 3, 2008 by Gummybr

[GTAm]

Getting back to your point GTAm, I also am confused how the duty free scheme can be used to buy locally assembled vehicles...

Do they pay for the parts and forget about the duty, or they pay the CIF value in SL + labour (forgetting the fact that the money will again be remitted back)

I won't be surprised if there are deals inside between the local manufacturer and ministers. This way they show the ever gullible public a nice patriotic face and earn loads of money as well.

Learned over last wkend how a certain minister has earned close to a billion Rs. by issuing body permits ! All you had to do was give him 300k! (x 3000+ permits!!!!)