Fourth Exporters’ Forum clears $106K in VAT refunds

* Exporters cry foul on Indian testing parameters
* Another $ 822K EDRS now with DoC
* Rubber exporters thank Forum for labour issue support


In a significant development to the Exports sector, the Exporters’ Forum (EF) –the Ministerial level Forum that solves exporters’ issues on the spot- has promptly moved with the Inland Revenue Department on VAT refunds of several exporters. Also, $ 822135 of pending EDRS payments to other exporters have now come under the consideration of Sri Lanka’s international trade arm-the Department of Commerce.

These important developments are reported at the successful conclusion of the Fourth Exporters Forum (FEF) held at the auditorium of the Export Development Board on 19 March. Rishad Bathiudeen (Minister of Industry and Commerce) along with the top officials of his Ministry, personally chaired the lengthy and interactive session along with Anura Siriwardene (Secretary, Ministry of Industry and Commerce), Dr. Neville Gunawardena (Director General- Department of Trade & Investment Policy), Asitha Seneviratne (Additional Secretary, Ministry of Industry and Commerce), Sujata Weerakoone (Director General of EDB), and Dr Yousuf Maraikkar (Actg. Chairman of EDB). Strong presence of the private sector, exporters, chambers, various advisory committees and top Government Ministries and departments including Floriculture Produce Exporters’ Association, the Ceylon Chamber of Commerce, Exporters Association of Sri Lanka, Fruit & Vegetable Producers, Processors and Exporters Association, Forum of Foods Exporting SME Companies of Sri Lanka, Association of Manufacturers and Exporters of Rubber Products, the National Chamber of Exporters, Tea Exporters Association, National Chamber of Exporters of Sri Lanka, the BOI, Customs, Minister Bathiudeen’s Industry and Commerce Ministry, Department of Inland Revenue, the Electricity Board, Ministry of Power and Energy, and Ministry of Finance and Planning. Among the private sector firms at the third forum were Chevron Lubircants, Haycarb PLC, Finlays Colombo, Akbar Brothers, Timex Garments, Agro Technics, SA Perera Co Ltd, Samson Rubber Products, Rainbow Engineering Supplies, ACL Cables Ltd, ATG Gloves, Regency Teas, EAM Maliban Textiles, CTP Pre-Pack Exports, Chelsea Enamels, and NM Mohamed Mohideen.

Having immediately cleared $106K of pending VAT refunds to ATG Gloves and CTP Pre Packs through rectification of computer systems issues of the Customs with Inland Revenue Department, the Forum also duly informed Timex Garments that Rs 10 Mn erroneous tax payment in respect of expatriates during tax holiday period may not be recoverable (Timex informed IRD that 8 such cases of refunds are pending towards the Company). The forum then informed the requesting party Chevron Lubricants Lanka PLC that their request to extend "TIEP facilities for the supply of lubricants to BOI companies which otherwise import from foreign sources would need to be considered under an alternative scheme" is unlikely to be granted since quantifying such lubricant imports ‘in practice’ is problematic. However, the Forum, then and there, has instructed the Customs Department officials present on the occasion to study it further.

Many exporters cried foul of various testing parameters adopted at some importing ports in India on Sri Lankan products. "Indian products across the board are landing in Sri Lanka everyday without any SLS or any other import inspections imposed at our end" said Mrs Dawn S Austin (MD-Nidro Supply Ltd), one of leading fruits and vegetables exports of Sri Lanka and an Exco Member of Lanka Fruits and Vegetable Producers Processors and Exporters Association. "This is not the case when we export to India" she stressed, and added: "We request this Forum to fast track the necessary remedies. We specially request the Forum to not to move these issues to high level frameworks such as CEPA since delays will be inevitable. These issues should to be addressed at working levels." The Forum also took due note of complaint by many other FMCG exporters that the Sri Lanka Standards Institution’s export certification has created an entry barrier to Indian markets at certain receiving Indian ports. "When they see SLSI certification, they do not take our exports in" voiced another Exporter.

The Forum has responded: "We need to see whether we can harmonise with Indian Standards based on mutual recognition."

Exporters also stressed on the need for local industry stakeholder consultations when FDI investors arrive in Sri Lanka for their BoI projects, in the aftermath of a proposed project in the spice industry that they viewed as ‘need to be monitored’. "There does not appear to be monitoring of what some investors do and where they do. Indiscriminate exports going out in other product category names (HS codes etc) thereby leaving traditional exporters at a disadvantage. Therefore when local producers and exporters want to expand their operations, we urge that they should be given the same level playing field as BoI firms" Mrs Austin informed the Forum. PD Fernando (Director General of Commerce) assured exporters: "We will be taking up these ‘across the board’ issues with our Indian counterparts at the highest level during our next official round." The forum also responded that the BoI and Exchange Controller Department have started looking into this matter.

Rubber manufacturers and exporters from Association of Manufacturers and Exporters of Rubber Products (AMERP) thanked the Forum for taking action by forwarding their request to Ministries of Labour and Department of Commerce in a relevant manner. During the previous Forum, AMERP requested to effect Sunday as a normal working day to enable the companies to grant the seventh day as a weekly holiday, after working six consecutive days of the week and to enable female employees to do overtime work more than 60 hours per month.

Minister Bathiudeen also directed the EDB to coordinate and study with the Forest Department on the requested permission to collect Nuxvomica Seeds for export by Eswaran Kathiresan & Co.


Rishad Bathiudeen (Minister of Industry and Commerce-seated second from left) addresses the fourth Exporters Forum held at the auditorium of the EDB on 19 March with Anura Siriwardene (Secretary, Ministry of Industry and Commerce-far left), Asitha Seneviratne (Additional Secretary, Ministry of Industry and Commerce-third from left), Dr Yousuf Maraikkar (Actg. Chairman of EDB-second from right), Dr. Neville Gunawardena (Director General- Department of Trade & Investment Policy-far right).

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