The Committee of Public Finance (COPF) headed by Dr. Harsha de Silva has proposed a waiver of customs import duty (CID) for local electric three-wheeler manufacturers, even if production takes place within a bonded facility.

“Local manufacturers currently operate within a bonding facility, where vehicles are produced and then exit through an ex-bond process. To level the playing field, a full waiver of customs, import duties, and surcharges for local manufacturers at the ex-bond stage, even if production occurs within a bonded facility, should be implemented,” de Silva said.

This measure, he argued, is essential to ensure fair competition with imported vehicles.

Recognising the importance of electric three-wheelers for small and medium entrepreneurs, de Silva said that the local electric three-wheeler manufacturer emphasised the need to reduce production costs.

“A proposed three-year VAT exemption for locally manufactured electric three-wheelers,” he said, would make the production of these vehicles more affordable and accessible to the public.

An official present at the committee meeting indicated that the proposal related to bond facilities could be “favourably considered.”

However, Industry and Entrepreneurship Development Deputy Minister Chathuranga Abeysinghe pointed out that locally manufactured vehicles are currently subject to the customs import duty at the ex-bond stage, which complicates the implementation of the proposed waiver.

Dr. de Silva countered that unless there is a technical barrier, the waiver should be implemented without delay.

Abeysinghe responded by stating that the Ministry of Industries would need to make a policy decision on the matter.

He further clarified that if the issue is related to implementation or transactional processes, the committee must be informed to facilitate resolution.

The proposed measures, if implemented, could reduce the financial burden on local manufacturers, particularly in the electric vehicle (EV) sector.