Tuesday, June 24, 2008

What's Sri Lanka's gas tax?

As readers of this blog would know, I have been trying to figure out what the total tax for petrol and diesel in Sri Lanka. I put the question out in a related article in LBO. Some people responded, you can read them here. I'm reproducing, without permission, the comment by ddm (who, by the way, I wish blogged more) :
given the frequent changes it's hard to keep track, but the best source is the customs website's tariff calculator. It's not 100% up to date but it's the closest freely accessible source of tariff information.

Before the change in May it was something like this;

Petrol - customs duty of Rs.5 per litre and a surcharge of 10% on this Rs. 5 which makes it R.s 5.50 per litre. Excise duty of Rs. 20 per litre, VAT 15% (in the last budget it was brought down to 5% but I'm not sure where this stands at the minute), Ports and Airports levy 3% and social responsibility levy of 1.5%. This is when petrol is completely imported as it is done by LIOC.

So if petrol costs Rs. 127 per litre CIF, the taxes on this would be Rs.38 at 5% VAT at Rs. 57 at 15% VAT.

According to Customs there are no tariffs, VAT, or any other levies on crude oil imports - and CPC refines 50% of its petroleum from crude oil imports (but still pays the VAT, excise on the petrol retail price).

For Diesel, again prior to changes in March, there was no customs duty or VAT, there was a Rs. 2.50 per litre excise duty, 3% PAL and 1.5% SRL.

But do check out www.customs.gov.lk - it's a great eye opener about how restrictive our import regime is. [link]

So, according to this, before the increase in May (Which was a whopping 37% for Diesel and some 23% for Petrol) The total tax is about 30% of the retail price of petrol at 5% VAT and about 44% at 15% VAT. TheIndian article, which quotes an Association of Indian Chamber of Commerce official is probably just about right when they say the total tax for petrol in Sri Lanka comes to about 37% of the retail price. That's high.

More on petroleum on deaned.

p.s. : Blogging is slow these days. I'm suddenly very busy and every time I do blog, I can think of 100 other things I "should" be doing. So if this doesn't update often, don't be surprised.


Christian Extremists Suck said...
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PaulHunt said...

Before these huge price increases us Americans were very lucky to have gas as cheap as it was. And it’s not a new idea to increase the gas tax. Many people have been wanting to use a larger tax increase for numerous things and now it may be coming into fruition. I read this article, Raise the Tax on Gas Circa 2004, a day or so ago and it let me realize that everything is costing more money and this doesn’t exclude the government. So how are they going to make more money to continue? A higher gas tax is a top candidate.

Deane said...

Yeah well, you guys have a final retail price lower than us anyway.