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by Ravi Ladduwahetty

The Exporters' Forum will deliberate on a series of new issues in the Value Added Tax (VAT) system, apparel, rubber and agri-industries at the Forum's next meeting on July 14.

The parley will be co-chaired by Minister of Enterprise Development, Industrial Policy, Investment Promotion and Constitutional Affairs Prof. G.L. Peiris, Minister of Commerce and Consumer Affairs Ravi Karunanayake and Minister of Industries Rohitha Bogollagama. The Forum will be attended by all the leading trade chambers, associations and Government officials in trade related organisations.

The meeting will deliberate on the delays in the Refund of Value Added Tax systems (VAT) where exporters pay for raw materials which they purchase locally and also services such as electricity and water for their industrial establishments, Secretary of the Exporters' Forum and Sri Lanka Export Development Board's Director (Services) M.K. Udayapala told the Daily News.

Exporters have pointed out that there are delays in the refund of the VAT by as much as three months and they have requested the option of reimbursement by around seventy five percent on the payment with the remainder within the next three months, he said. The exporters have pointed out to the Forum that the reimbursements were expeditious at the time of the former Goods and Services (GST) Regime.

There is a major issue in the apparel industry where the small and medium scale exporters in this product category have requested for concessionary financing to upgrade their technology in the wake of the termination of the Multi Fibre Agreement by the year 2005. They are of the view that the larger companies have their financial reserves and other safeguards to meet the challenges while the smaller exporters run the risk of not having the additional security to meet these contingencies.

They have asked for the reduction of the interest rates of the Sahanya Program which is now running at 14 percent and the SMILE 1 and 2 programs whose interest rates are at 15 percent to be reduced to a maximum of 6 percent as parallel to other competing countries such as Singapore, Malaysia and Thailand.

A Board of Investment (BOI) approved exporter of agri-produce has been promised a 2,000 acre plot of Government land in the Puttalam district for the processing and export of organic fruits and vegetables. The reason for the delay in the allocation of this plot of land had been due to protests from the Ministry of Natural Resources and Environment and the Central Environment Authority as the land is in close proximity and buffer land of the Wilpattu National Park.

A rubber exporter has called upon the forum to grant permission to import raw rubber at the time that international prices are low with the objective of stocking it and re-exporting and also to supply local companies. This will be essentially a marketing exercise in the raw form and without value addition with the view of entrepot trading. BOI approved footwear exporters have also asked the Forum permission to market a part of their production in the local market paying a fixed rate of duty.

Ginger exporters have also asked for a refund on Customs duties paid for a consignment of organic ginger imported and not suitable for consumption. The Sri Lanka Ports Authority and the Customs Department had earlier destroyed this consignment and the exporters have now asked for a refund of the Customs duties.

The Exporters' Forum was recommenced in 2002 and has held nine meetings that year and four this year. The Forum had 297 issues last year of which 115 were solved or clarified, amounting for 39 percent, Udayapala said.

The Forum was commenced in 1982 by the then Minister of Trade and Shipping Lalith Athulathmudali and went on uninterrupted till 1991. It was recommenced in 2002, he said.

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