Additional taxes lead to loss of Government revenue Chairperson Abans, Aban Pestonjee

"The 'Sinhala only' political decision made in 1956 was undoubtedly the germ that led to the ethnic conflict; it also took the country backwards and was the germ for the ethnic problem."

A woman barely out of her teens, who set up an electrical appliance buying and selling business in the back of her garage, in the late 1960's has single-handedly driven her enterprise to be Sri Lanka's number one electronics store.

Getting married at the age of 19 and setting up her own business the following year Chairperson Abans, Aban Pestonjee speaks to Daily News Business.

by Shirajiv Sirimane

The Sri Lankan tax structure should not be changed regularly to the whims and fancies of politicians and a few pundits and there should be a permanent and transparent system in place. "The tax structure is very complicated and changes so fast that we simply cannot keep track."

"When we select and order an item from our buyers after checking its duty component and price, we find that when this product is cleared at the Customs new duties have been added. Due to this sometimes we are unable to sell the item at a profit as subsequently they have to increase the price and in most cases it's too high for the local consumer."

She also said that it is always the 'big companies' that pay taxes. "We are not against paying tax. However if

 the tax structure is reasonable we can pay more to our employees and their welfare," she said.

What the Government fails to understand is that by increasing taxes some importers underinvoice and it also leads to smuggling. The end result is the Government loses revenue and the customers too do not get a guaranteed and a quality product.

An old girl of Good Shepard's Convent, Kotahena and a netball player she says that the closed economy drove her to the business of marketing electrical appliances.

Her parents were from Persia and her father who was a marine engineer serving in the Colombo Port in the late 1940's was later awarded an honorary citizenship for his services.

"Our race is an endangered species today and was at a Zoroastrian religious hall which practises the oldest religion that I met my husband," she recalled.

She says that her favourite past time even today is to be with the family and is not too keen on sophisticated equipment. I use a simple mobile phone and do not carry a note book computer," she said.

As for a holiday she prefers Nuwara Eliya, South Korea and UK.

She shyly admitted that it takes a longer time to dress up to a Sari and prefers wearing trousers and blouse.

It was the era where imports were restricted and people were looking out for household equipment such as polishers, cookers, air conditioners and refrigerators. "I saw an opening here and decided to buy used appliances, repair, modify them and re-sell," she said.

The first thing I used do was to buy the 'Daily News' early in the morning to search for classifieds. "After making inquiries I take my three children and drive my own vehicle and buy the items," she recalled.

To purchase these items she drove over 100 miles per day. "Distance was not a problem for me," he said. Embassies too were one of her main hunting grounds.

She also hired technicians and carefully monitored the repairing process before they were resold. "I also provided my own guarantee as I wanted to keep the customer happy," she said. This is a policy that is followed even today.

After appliances were refurbished she personally came to the Daily News advertising counter and places advertisements which were very successful even during that time. With the business expanding, a 500 square feet room was rented in Bambalapitiya for a monthly rental of Rs. 35.

She recalled that obtaining the Electrolux local agency was the turning point of her business.

How did you manage to convince to be awarded an international agency?

Soon after the open economy was introduced I was worried as I knew that my enterprise was at a risk as the people had direct access to purchase appliances from the international market.

Leading players like Walkers and Millers were having a monopoly of products such as Electrolux, Hoover, Belling cookers and I decided to write to them regularly requesting them to award their agency to me.

After a long wait agents from Electrolux visited my shop and work place and they were so satisfied they awarded me the agency.

Soon after I set up a limited liability company investing my own money as bank loans were impossible to get.

Subsequently Hoover agents too visited me. However they wanted me to do away with the Electrolux agency if I was to be awarded the Hoover agency. I did not want to let down Electrolux as they recognised me first. Finally Hoover came back to me and during the first year of business I had sold more products than their former local agent had sold for five years.

Later due to high freight charges I decided to get agencies of Japanese and Korean products as well.

What made you diversify to other companies?

Well it was my children who studied overseas setting these companies and they are placed in charge of them.

How do you see the challenge from the low priced items sold in Pettah and the open market and at the Duty free?

This is a area of concern in my business as they do not pay taxes and they don't have many overheads.

However I overcome this by offering the best after sales service and providing a quality product and people still value that to cheaper products.

How do you see the advertising industry today?

It has definitely expanded and it is needed for a business to prosper and I feel that seasonal advertising is a must. Placing an advertisement at the appropriate time really pays off.

What is your solution to the ethnic problem in the country?

Well, permanent peace can only be achieved through a negotiated settlement. No country has ever won without negotiating. Permanent peace can make Sri Lanka a very prosperous nation and I am so sad that this problem has dragged so far.

Do you follow politics?

Yes I do as their decisions affect my business too.

However I am so disappointed with the political decision, 'Sinhala only' made in 1956. Undoubtedly this was a germ that led to the ethnic conflict and it also took the country backwards.

Before the implementation of this Bill there was no division of the community such as Tamils or Sinhalese. Youths were deprived employment since they did not know English and it also led to a brain drain of the country which is still evident. If not for this Bill Sri Lanka could have been another hub for IT similar to Bangalore.

I still think authorities must consider making English the first language and there should be more discipline in the country. This should be taught from the kindergarten.

With 15,000 employees, over 22 subsidiaries including Abans Travels, McDonald's, Environmental Services and Office Automation, Aban says that she does not need Government assistance but needs a permanent policy on taxation.

She also leads a project to train youth in electronic technology and send them overseas for training. She is also looking at creating an entertainment park for the whole family. "By this youth would not go to night clubs and get into drugs and it would keep them occupied," she said.