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Sri Lanka to charge retrospective taxes on converted vehicles
04 Jan, 2013 09:47:46
Jan 04, 2012 (LBO) - Sri Lanka is set to charge millions of rupees of taxes on a retrospective basis from owners of pick-up trucks and jeeps who have converted them under existing rules, according to a new cabinet decision.
The state information office quoting a cabinet paper from the ministry of transport said single cab pick-up trucks imported under a lower duty structure have been converted to double cabs which attract a higher duty.

Land Rover defender jeeps auction by state entities were also being converted 5-door luxury station wagons by changing the body.

"The difference between the tax payable for a new/used imported vehicle similar to that of the converted vehicle on the date of registration of the converted vehicle and the tax already paid on the converted vehicle at the time of its importation, should be paid as a surcharge to the Government," the information office quoted the cabinet paper.

"The registration of such converted vehicles under the above conditions should be completed by 2013-03-31 and registration of such vehicles after the above date should not be permitted under any circumstances."

Analyst say retroactive taxes and laws, which are ad hoc in nature undermine the certainty that should come from the rule of law.

In a free country it is the practice of rulers to 'grandfather' any mistakes of the state in drawing up laws and make changes applicable to the future.

In free countries with strong constitutional guarantees of liberty to citizens, so called ex post facto laws are specifically prohibited.

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READER COMMENT(S)
6. Shaik Anwar Ahamath Jan 05
Retroactive indirect universal taxation can never be justified under any circumstances because the taxed individual was never given the choice to expend money already taxed on purchases to pay more taxes than which is already levied at the whim of a politician.
5. Vishaka Jan 04
If the government is really concern about the economic development, They will refund the taxes when some one added more passenger capacity to a vehicle. Because this conversion will burn less fuel to transport a passenger. The higher tax must be charge to the vehicles converted with higher capacity engines without increasing seating capacity. Adding number of doors will be good for the safety. But I think the treasury can make more money by charging appropriate taxes from duty free vehicles and luxury Lamborghini cars.
4. Jay Jan 04
They converted the body after import those vehicles. How come they charge for the conversions.

What are they getting for this conversion?

3. kawdaboy Jan 04
The price of pre 64- Land Rovers/Defenders will plumet! Most military ex vehicles were 2 door, which have been converted to 5.
2. Jack Point Jan 04
Arbitrary changes in laws will dent confidence in the system further.

There is no overriding policy, whatever quick fix that comes to hand is implemented.

This increases uncertainty, in the minds of citizens-and investors both domestic and foreign.

Uncertainty = risk

Greater the risk = the less likely investors are to invest.

Less investment = less jobs

Wonder who will benefit from this?

1. Citizen Silva Jan 04
Who said Sri Lanka is a free country with constitutional guarantee of liberty to citizens. We lost those rights on the dy the President was elected to a second term.

With a finance ministry bankrupt with ideas to raise money to keep the government going, you can expect more taxes and if the source can be traced to the origin all those taxes will come with retrospective effect.

Even double taxation like tax on Super Markets which will cause hardships to people will be the order of the day. No one will raise objections not the legislators of both sides supposed to be representing the people, Newspapers supposed to be voice of the people and dumb public living on dreams of war victories and nationalism.