Tax concession to benefit local footwear industry
Harshini PERERA
The
Sri Lankan footwear industry can expect a huge boom as the Government
has lifted the duty structure on footwear machinery and raw materials.
The Government decided to lift the 2.5 percent taxes on footwear
manufacturing machinery and raw material.
Though this seems a small amount, compared with the prices of
machinery it will reflect as a large concession for industrialists,
Leather Footwear Advisory Council Chairman Rangith Hettiarachchy told
Daily News Business. The tax concession will strengthen the local
industrialists with more capacity to cater to the local as well as
international market. It will enable not only large companies but also
SMEs to cater to the export market as suppliers.
“When the tax concession is given on machinery, the SMEs in the
industry can introduce new technologies. The industrialists can target
the international market and the Sri Lankan footwear can foresee a
better future,” he said.
Sri Lanka’s footwear exports was US $ 17 million and leather and
footwear is a product under the GSP+ concession. Sri Lankan footwear
exports can also have negative effects if EU denies the GSP+ concession
to Sri Lanka. Hettiarachchy said Sri Lanka has to come out with
exclusive designs and new developments in the industry to overcome the
situation. Sri Lanka needs to equip with the latest technology to
compete with countries such as China.
“We were able to establish good relations with Indian footwear
manufacturers after the Buyer-Seller meeting held in Sri Lanka recently
and the outcome can be expected in few months time with an industry
growth,” he said.
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