Government imposes 9 conditions on private vehicle imports

Government imposes 9 conditions on private vehicle imports

Gazette Notification No. 2421/44 has been published with effect from today (01) allowing the import of vehicles for personal use classified under 304 Combined Classification Codes, removing the temporary import restrictions in force since the beginning of the year 2020.

Accordingly, import permission has been granted for motor vehicles such as cars, vans, buses used for public transport, motor vehicles used for the transport of goods, vehicles used for special purposes, three-wheelers, motorcycles and other items not using motor engines.

The Ministry of Finance, Planning and Economic Development, with a view to protecting foreign exchange reserves, discouraging the importation of vehicles in large quantities at the expense of foreign exchange, and increasing state revenue, has issued the following conditions relating to the import of vehicles with the objective of encouraging normal economic activities in the country and securing economic stability.

Accordingly,

Importers registered with the Department of Motor Traffic and State Institutions may import vehicles subject to the regulations hereby imposed.
Importers other than those referred to in paragraph (1) above may import only one motor vehicle in a period of 12 months.
Any imported motor vehicle shall be registered in the name of the purchaser (in case of purchase from a registered importer) or in the name of the importer with the Department of Motor Transport within 90 days from the date of the import bill/customs entry in respect of the said motor vehicle.
For the registration of motor vehicles, the importer or purchaser shall submit to the Commissioner General of Motor Transport an affidavit containing the Taxpayer Identification Number (TIN) issued by the Department of Inland Revenue along with all other necessary documents. Furthermore, importers other than those mentioned in paragraph (1) above, when importing their second vehicle, should also state in the said affidavit that they have not imported any other vehicle within a period of 12 months from the date of import of their first vehicle (from the date of customs entry).
If an importer fails to register an imported motor vehicle within 90 days, the importer shall be liable to pay a late fee of 3% of the monthly CIF value, subject to a maximum limit of 45% of the cost, insurance and freight (CIF) value of the motor vehicle at the time of registration.
In no case shall a fee waiver be granted in respect of the payment of the monthly late fee.
In determining the age of a motor vehicle, the period between the date of manufacture of the motor vehicle and the date of the bill of lading/air waybill shall be calculated.
No motor vehicle shall be allowed to be imported or released from customs using permits issued for the import of motor vehicles under concessional tax concessions.
If any motor vehicle is imported in violation of the existing rules and regulations, the said motor vehicle(s) shall be re-exported by the relevant importer within 90 days from the date of customs registration.

Furthermore, Gazette Notification No. 2421/05 dated 27th January 2025 was published under the Revenue Conservation Act No. 19 of 1962 to re-enforce the duties not levied in accordance with the provisions of the Customs Exemption Ordinance. Accordingly, the levy of duty at the rate of 20% of the cost, insurance and freight value (CIF Value) of the vehicle on the import of motor vehicles falling under Customs Code Chapter No. 87 was enforced from 28th January 2025.

However, a Gazette Notification No. 2421/43 dated 31st January 2025 has been published to impose a surcharge under Section 10 (a) of the Customs Ordinance, which imposes a duty of 30% on the cost, insurance and freight of the vehicle on the import of motor vehicles, with effect from 01st February 2025.

Accordingly, provisions have been made to levy a total duty of 30% on the import of motor vehicles under the Customs Ordinance (235) Act, in addition to the existing duty of 20% and the surcharge of 50% imposed on it.

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Source: https://sinhala.adaderana.lk/news/206083