The Sri Lankan government has announced the reinstatement of excise duty on vehicle imports, effective immediately. The decision marks a significant shift in the country’s import policy, with authorities aiming to manage fiscal challenges and regulate the inflow of foreign vehicles.

Officials stated that the reintroduction of excise duty is part of a broader strategy to stabilize the economy and reduce the foreign exchange outflow. The government hopes the measure will encourage the use of locally manufactured vehicles and lower dependence on imports.

The specifics of the excise duty structure vary depending on vehicle types, engine capacities, and fuel efficiency. Larger, high-emission vehicles are expected to face higher duties, while smaller, environmentally friendly options may receive comparatively lower levies.

Importers and dealers have expressed concerns over the immediate rise in vehicle prices, which could affect consumer affordability. This change might also cause a temporary slowdown in vehicle sales, particularly for imported models.

While environmentalists and advocates for local manufacturing have welcomed the move, car dealers and buyers have criticized the sudden implementation without prior notice. Many argue that the policy may burden middle-class families aspiring to purchase vehicles.

Economists suggest that the excise duty could generate significant revenue for the government in the short term. However, they warn that a balanced approach is necessary to ensure the policy does not stifle consumer demand or disrupt the automotive industry.

This development underscores the government’s efforts to manage the nation's economic recovery while addressing import dependency, though its effectiveness remains to be seen in the coming months.