Sri Lanka’s hopes for cheaper vehicles have been pushed further away, as the government moves to extend a heavy import surcharge, effectively freezing high market prices for at least another year.
The Ministry of Finance has decided to extend the 50 percent surcharge imposed on imported vehicles until December 31, 2026, dealing a blow to expectations of price relief in the automobile market. According to the latest government gazette notification, the surcharge will continue to apply to both used and refurbished vehicles brought into the country.
The move extends the validity of extraordinary gazette notifications issued in January and April last year, which were originally introduced as temporary measures. With the extension now confirmed, the higher tax regime will remain in force until the end of next year.
Financial sector sources say the continued implementation of these import taxes means a meaningful reduction in vehicle prices is unlikely in the near term. Despite earlier hopes that easing restrictions would bring down costs, authorities have opted to maintain the surcharge in light of ongoing economic pressures and foreign exchange management concerns.
Market analysts note that this decision will effectively keep vehicle prices at their current elevated levels. Any significant drop in prices, they say, would require both tax relief and improved currency stability.
As a result of the amendment, automobile importers and consumers who were anticipating price concessions will now have to wait at least another year, prolonging frustration in an already strained vehicle market.
