Parliament

Chock-a-block on roads impacts environment

Sandasen Marasinghe and Irangika Range

Speaker Chamal Rajapaksa presided when Parliament met at 1 pm yesterday. After presentation of papers and oral questions, the House took up the Customs and Excise Ordinance for debate.

International Monitory Cooporation Senior Minister Dr. Sarath Amunugama: Vehicles imported to the country have increased during the past two-three years due to tax concessions given by the government. Social and environmental impacts, including traffic congestion, high fuel consumption, etc have arisen with the increase of vehicle imports.

It is necessary to create a regulatory mechanism to control this situation. Considering the negative impacts, we decided to increase the tax imposed on vehicle imports.

It is reported that 469,000 new vehicles have been imported to the country in 2010, and another 524,000 new vehicles in 2011. This indicates 125 percent increase in 2010 and 148 percent increase in 2011 compared to 2009.

The import of new motorbikes increased by 61 percent and 81 percent in 2010 and 2011, respectively. Three-wheeler imports too have escalated due to the tax relief. It is reported that three-wheeler imports have increased by 163 percent and 293 percent in 2010 and 2011, respectively.

Fuel consumption has intensified due to the increase of motor vehicles. Therefore, tariff has to be increased on the import of motorbikes, motor vehicles and three-wheelers. However it will not affect the import of agricultural equipment, buses, lorries and tractors.

Dr. Harsha de Silva (UNP): According to the Central Bank’s investment policy, EPF and ETF money cannot be invested in shares of any banks or financial institutions. So why is the government engaged in investing EPF and ETF money of the innocent people violating regulations. The Monitory Board of the Central Bank has to bear full responsibility for these transactions. The Labour Relations Ministry has no power to handle EPF and ETF money. According to the EPF Act, the EPF investments should be confined to Blue Chip companies.

The EPF Act was amended. So how does the government invest EPF money in shares of the Galadari Hotel as it is not a Blue Chip company. You are cheating the innocent people who deposit their money in the EPF. People of the country should be made aware of the situation.

Petroleum Industries Minister Susil Premajayantha: In a single year in 2011, 523,000 vehicles were imported to the country. The vehicle import in 2010 increased by 100 percent compared to the previous year. In 2011 the rate was 147 percent. This tax relief was given to the people after the elimination of terrorism. Now it has to be removed.

The Opposition questions where the money is that was spared by ending the war. The economic growth rate was minus during that period though it is high today. The road network is excellent today so that people bought vehicles.

The electricity provision was 60 percent then but it has been increased to 93 percent by the government. Sri Lanka is the only country in the region that provides electricity 24 hours. Nepal and Pakistan cut power for 14 hours. India also is the same.

The production cost of an electricity unit is Rs 16 but we provide it at Rs 8.50 up to 90 units. This burden is shouldered by the government. However, the Petroleum Corporation suffers a loss of Rs 106 million to generate electricity at a low price.

India increased fuel price by Rs 21 in Sri Lankan money. The price of petrol in Delhi is Rs 176 in Sri Lankan money. India which produces 30 percent of fuel increased the price. We will reduce the fuel price if the present situation persists.

Ravi Karunanayake (UNP): Today, the price of a crude oil barrel is 88 US$ in the World Market. Petrol could be given at Rs 73. The country has the highest price of fuel and electricity in the world .

Deputy Speaker Chandima Weerakkody takes the Chair

Social Services Minister Felix Perera: Developed countries have a demand for good quality vehicles. We can buy good quality Japanese vehicles from America or Canada at a very low rate. They are used vehicles. But the problem is they are left hand vehicles. We have to allow them to be converted to right hand vehicles.

Nearly one million tourists visit Sri Lanka annually bringing in a large amount of money. They come due to the government’s skill and the prevailing peace in the country.

Janaka Priyantha Bandara takes the Chair.

Sunil Handunnetti (DNA): The Deputy Finance Minister said he would consider to grant relief to the people who attempted to import vehicles for their personal use and now face difficulty due to the increase of tax. They are only a few hundred in number. But the Ministry Secretary says it cannot be done. Somehow the innocent people are in trouble.

Transport Deupty Minister Rohana Kumara Dissanayake: We have to think of the environment and the government has taken that fact into consideration.

Transport Deputy Minister Rohana Kumara Dissanayake: The government has been able to maintain highest economic growth rate during last two-three years despite the global economic crisis and natural disasters. We never cut off the relief provided to ordinary people.

The government has given permission to the private sector to import buses with the aim of strengthening the public transport system for the benefit of the people.

Dayasiri Jayasekera (UNP): The Mathata Thitha programme launched by the government is totally unsuccessful. Lcal alcohol production and consumption has increased. The number of liquor permits issued by the government has escalated.

The share market has collapsed as a result of unnecessary intervention by the government. People have lost faith and confidence in the share market. Today there is no Director General appointed to the Stock Exchange.

Education Minister Bandula Gunawardene: The trade deficit has gradually increased in the past two-three years. It is necessary to cover the trade deficit by using foreign reserves or with foreign aid and loans.

This is the normal economic theory in the world. It is the responsibility of the government to interfere logically and in a scientific manner to maintain proper trade balance.

Import cost has increased as a result of the increase of vehicle imports.

It is reported Rs 2.2 billion was spent to import vehicles in 2009, while Rs 41 billion and Rs 75 billion were spent in 2010 and 2011 respectively, to import vehicles. This increase is extraordinary. The import cost has shot rapidly due to the increase in vehicles and fuel consumption. Sri Lanka as a small country cannot bear this cost. The government has to interfere to control the situation. Otherwise, the country will face problems placing many burdens on the public.

That is why the government decided to increase the taxes imposed on vehicle imports.

Eran Wickramaratne (UNP): Taxes imposed on cigarettes are very low in comparison to taxes imposed on essential commodities. Although there is a Mathata Thitha programme to curb the consumption of liquor, consumption in the country has increased. Especially the youth has been targetted for selling liquor.

Today the youth can easily purchase liquor as they are available even in supermarkets.

Health Deputy Minister Lalith Dissanayake: The government has taken measures to secure the public money deposited at all banks and financial institutions. It has intervened in a logistic manner to stabilize the share market.

No financial institution has collapsed while no harm has been caused to public deposits. It is the Opposition which tries to mislead the innocent people by spreading false information.

Palitha Range Bandara (UNP): Twelve out of 37 private institutions taken over by the government forcibly have already been sold. April salaries of the employees at several institutions have not been paid yet. Salary is one of the main rights of the employee and the government should look into this matter.

Finance and Planning Deputy Minister Geethanjana Gunawardene: The beer consumption has increased twofold after the liberation of North and East. As a result of the increasing tourist arrivals to the country, both beer and liquor consumption has increased.

According to the EPF Act, the EPF funds can be invested in share market and banks. The EPF is carefully handled by the government. The allegations of the Opposition with regard to EPF is baseless. It is reported 88 percent of the EPF has been invested in Treasury Bonds.

The House was adjourned until 1 pm today.