Grand old lady devastated as Customs impose Rs. 3.5mn duty on her old car

‘It is our family faithful. Our dreams are shattered’, says Mrs. Savithri Melder


Savithri Melder with her husband Evan, daughter and grandson in Melbourne.

The grand old lady was delighted at the prospect of returning home to Sri Lanka from Down Under in the ‘winter of her life’.

Domiciled in Melbourne, Australia, for two decades plus was indeed a refreshing experience, but there was no turning back as the time was opportune for the elated grandma to go back to where she belonged so that her "bones could be interred in her motherland".

The bags were packed and the octogenarian was eager to fly back to her land of birth, with her 85-year-old hubby, but it was heart-breaking to leave behind their "family faithful", the old car which served them loyally for almost 10 years.

"It was like deserting your old grandmother", reasoned Mrs. Savithri Melder. "We simply couldn’t exist without our trustworthy Toyota car, which has silently served the family over the years".

"We lived in the USA for 20 years before settling down in Melbourne, where we spent 22 years", she noted. "As I am a sentimentalist, I brought some other household goods also to Sri Lanka as I felt I had to be loyal because I spent more time and been closer to them than any member of my family".

A permit to import the vehicle from Australia was secured in Sri Lanka and on September 7, 2015, the old workhorse arrived in Colombo. Savithri and her husband Evan were thrilled at the prospect of being ‘reunited’ with their ‘good old friend’, who had always stood by them in the land of the kangaroos.

They pocketed out US$ 2,700 as freight charges to ship the car and were keeping their fingers crossed to clear the vehicle when it reached Colombo. "It will revive pleasant memories as our final wish was to live peacefully and die on Sri Lankan soil", she smiled.

But, the old couple was in for a rude shock. Their happiness was short-lived and their world virtually disintegrated as the Customs imposed a duty of Rs. 3.5 million on the old automobile.

"This was a bombshell. It is beyond us to fork out millions of rupees to pay such a hefty duty, which is not fair as this is an old car used for almost 10 years", Savithri protested.

"We have been left shattered by the indifference and insensitivity of the whole episode", she continued, and intoned "I was devastated on hearing this distressing news. I suffered heart failure and was hospitalized, but refused to finish my treatment and insisted on being discharged because I wanted to save my car".

"My immune system is weak now and I also caught the virulent flu and almost lost my voice", she said softly, struggling to fight back tears.

With her dreams shattered, the devastated octogenarian, reflected, "I am longing for my good ‘friend’ who has transported me to many hospitals and doctors in Melbourne, without letting me down".

With the vehicle held up at the Colombo port since early September this year, demurrage has climbed to Rs. 400,000, which translates into a substantial Rs. 3.9 million to clear the old Toyota model.

"I was told by officials that under these circumstances, only the Finance Minister is mandated by law to grant a duty reduction/waiver. This started my next arduous and exhausting pilgrimage to the Finance Ministry, where, I was told the earliest appointment could be given three weeks later", Savithri recalled.

"Despite our age, my husband and I went at 6 am for the appointment and the Minister indicated that the matter will be ‘looked into’. This gave us immense hope, with some officials also suggesting that our woes were over and the car should qualify for some relief", she asserted.‚Äč

"We were joyous at the thought of being reunited with our car", she recounted. "Our hopes leapt when an official wanted our clearing agent to visit the Customs. We were on Cloud 9".

Then came the anti-climax. A Customs official told our clearing agent that the minister’s endorsement meant nothing, Savithri lamented. "Apparently, it was meaningless and we were back to square one".

"If this was the anticipated outcome, why did they start this by asking me to appeal to the minister?", she queried. "I was told at the beginning that they impose duty to prevent traders from importing old cars and selling them to make money. But, as ours is a genuine case, we were assured the minister could decide on either reducing or waiving the duty".

Under the law, the Finance Minister is empowered to grant duty waivers, but in case of vehicles, it is generally considered in case of those imported by religious institutions, social service organizations etc., says Customs spokesman, Leslie Gamini.

He said that the minister cannot reduce the applicable duty, VAT and similar levies under the tax structure, but can grant duty waivers on a case-by-case basis.

The minister cannot ask officials to "look into" or "consider" duty waivers as this area is his prerogative and it is he who should decide as the Customs is a mere implementing authority and not a decision-making body, an authoritative source said.

The 2016 Budget also pushed up the duty on vehicles substantially, but as in the case of the Melders, their old car was imported in September, two months before the budget was presented. The question that arises is whether the hefty Rs. 3.5 million duty component on a near 10-year-old, used automobile was in line with other similar tax revisions.

"No, the revision on valuations based on the FOB value is applicable only for vehicles for which Letters of Credit (LCs) were opened after October 18, 2015", a senior Finance Ministry official clarified.

The calculation of the duty on a vehicle is based on a valuation by the authorized agent in Sri Lanka, officials said. "It may sound strange, but the duty is calculated on the basis of a similar model in mint condition".

"I am at a loss to understand how the duty calculation on an automobile almost 10 years old is the same as that of a brand new vehicle", she noted. "This is ridiculous".

In desperation, Savithri has appealed to the President, Prime Minister and the Finance Minister. "My fervent hope is that there will be a human face to this saga to end our agony".

Interestingly, her husband Evan was a diplomat and an international civil servant. He had earlier worked as the late Esmond Wickremesinghe’s personal assistant.

She said at the time Evan was posted to the US, it was Wickremesinghe with the then President J. R. Jayewardene who helped her to join her husband as being a Tamil she was traumatized after her house was set ablaze during the 1983 communal riots.

"It took me years to recover from the shock of this dreadful experience and I still shudder when a picture of the furious crowd burning the Tamil shops flashes before my eyes", Savithri noted.

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