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Minister of Rural Economy and Deputy Finance Minister Bandula Gunawardena affirm that the diesel motor vehicle tax in any form will not be reimposed in the future.

He said in a press statement that in pursuance of a Cabinet decision taken on 12.10.2001 by the previous Government the tax on diesel motor vehicles imposed under the Finance Act No. 15 of 1995 was abolished with effect from the same date. In terms of the provisions contained in the act the diesel tax payable on each year should be made by the registered owner of the motor vehicle on or before the respective date. The act defines the "respective date" as the date on which the vehicle was registered. Accordingly the diesel tax in respect of the year 2001/2002 was payable on registered diesel motor vehicles between the period from April 1 to October 12, the date on which the cabinet decision became effective. If the date of registration falls on any date within the period of October 12th to March 31st the diesel tax for the year 2001/2002 should not be payable by such vehicle owners.

Amendments to the Finance Act are being introduced in order to make this cabinet decision effectual in law. This is expected to be presented in Parliament in May this year (2002). As such, the present government, as stated in this news item, has not made any decision to reimpose the diesel tax. What is in fact being done in to provide for necessary legislation to make the above cabinet decision legally binding. This tax in any form will not be reimposed in future.

The problem that has been encountered in the implementation of this cabinet decision is that certain sections are being unduly affected due to its abrupt abolition. There is no room to intake action in this regard under existing legal provisions.

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