Muzammil points out tax disadvantage faced by local industrialists when importing machinery

By Saman Indrajith

State Minister of Money, Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal told Parliament yesterday that Rs. 1,196.8 billion had been spent on importing machinery during the yahapalana government.

Responding to a question raised by SLPP MP Mohamad Muzammil, the Minister said that action had been taken to promote machinery production in the country thereby saving a huge sum of foreign exchange.

When the procurements were made in public sector institutions for machinery, EU standards were made a requirement, the MP said.

 “Although we have workers who could produce the same machinery they cannot sell their products to the public sector institutions because of the so-called EU standard.  We also have institutions such as the National Engineering Research and Development Centre and the Industrial Development Board which can test that machinery produced here and give certificates. The amount spent on foreign machinery and equipment is huge. Can any action be taken to ensure that local products will be given priority so that foreign exchange can be saved?”

Minister Cabraal said that the amount spent on importing machinery indicated that there was a significant demand for machinery in the country. “We must find a way to help local industrialists, and I promise that action would be taken in this regard.” he said.

 “When machinery was imported the local producers have to pay duties, but the same machinery could be imported by the BOI companies without duty. Can the same duty waiver be given to local producers, too?”

Minister Cabraal said the issue would be studied with a view to providing relief to local industries, as requested by the MP.