Govt. hikes production and alcohol taxes

Friday, 14 February 2025 00:00 - - {{hitsCtrl.values.hits}}

Raises production taxes on motor vehicles, cigarettes, soft drinks and tobacco as well as excise tax on alcohol by 5.9% from 11 January

The Government has decided to raise production taxes across a range of goods, including motor vehicles, cigarettes, soft drinks and tobacco, by 5.9% as part of its broader fiscal policy adjustments.

The Cabinet of Ministers on Sunday approved the proposal presented by President Anura Kumara Dissanayake in his capacity as Finance, Plan Implementation, and Economic Development Minister, paving the way for Parliamentary approval of the revised tax measures. The tax increase, effective from 11 January 2025, was formalised through an order issued under Section 3 of the Production Tax (Special Provisions) Act No. 13 of 1989 and published in Extraordinary Gazette Notification No. 2418/43 on 10 January 2025.

In parallel, the excise tax on alcohol has also been raised by 5.9%, with the revised rates coming into effect on the same date. The adjustment was outlined in Notification No. 01/2025, issued under Section 22 of the Excise Ordinance (Authority 52), and published in Extraordinary Gazette Notification No. 2418/42.