New tax imposed on Gold imports
April 18, 2018 04:42 pm
An import levy of 15 percent on its value has been imposed on gold imports with effect from midnight yesterday (17), the Finance Ministry said.
The move is aimed at curbing surging imports that have impacted the trade deficit and put pressure on the exchange rate, officials said.
The finance ministry said the tax was reintroduced after a five-year hiatus as authorities detected a rapid spike in imports in recent months.
“We believe that a lot of duty free gold (imported to Sri Lanka) is smuggled out to neighbouring countries where there are high customs duties,” a finance ministry official told AFP.
He said nearly 8,000 kilos (17,600 pounds) of gold had been brought into Sri Lanka in the first three months of this year -- almost equivalent to all imports of the precious metal in 2016. Last year, more than 15,000 kilos was brought in.
The steep increase had not translated to a boon in jewellery manufacturing -- sparking suspicions it was being spirited to neighbouring India, the world‘s largest consumer of gold.
Sri Lanka‘s central bank warned in February that the sharp spike in gold imports was worsening the island nation’s yawning trade deficit.
-Agencies
