A shipment of 525 vehicles that was unloaded at the Hambantota Port last week had 312 super luxury vehicles which were mainly imported on duty free concession permits, customs sources said yesterday.
Most of the super luxury vehicles imported were Montero Sport, KIA/Hyundai SUV, BMW X 1, X 3, 520D and Audi A 4 and A6.
Recently the government had increased the Cost, Insurance and Freight (CIF) value of permits from the earlier 25,000 US dollars to 30,000 US dollars. Therefore super luxury vehicles such as the Audi A 6 and BMW X 5 now comes under this category with the increase of the CIF value by US 5000 dollars.
Most of the super luxury vehicle permits had been sold by parliamentarians. Stakeholders in the industry urged that the government should limit the permit values to enable public servants to legitimately afford standard cars, vans and double cabs.
According to them the loss incurred by the government was Rs.8.5 million on a Montero Sport, Rs.6 million on a KIA SUV, Rs.13 million on a BMW X1/X3 and Rs.20 million on a BMW 520D.
The reduced duty prices for these vehicles were between Rs.6.5 million and Rs.9.5 million respectively. They also noted that details should be obtained from third parties who had brought the permits and also from vehicle dealers, insurance companies and leasing companies.
Another regulation that they are urging the government to enforce is to cancel the power of attorney and sales agreements serving as legal loopholes allowing such transactions.
Therefore the government is facing a multi million duty loss as the number of luxury vehicles imported to the country on permits has risen rapidly during the last three months.
According to sources at the Registrar of Motor Vehicles (RMV) more than 10,000 tax free vehicles imported by public servants who had illegally sold them by violating the three year term were running on the roads at the moment.
Once the government issues the permit, then the permit is the agreement between the vehicle manufacturer and the permit holder. According to Customs the manufacturer is obliged to deliver the vehicle straight to the house of the owner of the permit on time through the local agent of the parent company.
According to RMV sources there are local dealers who manipulate the system by bringing down vehicles on permits for third parties where the dealer clears the vehicle by allegedly keeping Rs.1.5-2 million for them, for facilitating the transaction.
By Supun Dias
Source: Daily Mirror (Sri Lanka)
