Not much cheer from 2019 Budget for Tea Exporters Association

Thursday, 7 March 2019 02:03 - - {{hitsCtrl.values.hits}}

The Tea Exporters Association (TEA) welcomed some of the proposals of 2019 Budget in a statement yesterday, though expressing concerns over few others.

Following is TEA’s full statement:

“As expected, the Government has proposed a number of incentives and grants targeting the young entrepreneurs and general public, including salary increases for government servants. Although these measures may be the need of the hour, any expenditure on non-productive areas could trigger the inflation and domestic debts.

“The budget proposals on export sector are somewhat below the expectations of tea exporters. The reduction of Economic Service Charge (ESC) from 0.50% to 0.25% would certainly benefit the exporters, as it would ease the cash flow issue to some extent. The reduction of Port & Air Port Levy (PAL) from 7.5% to 2.5% for import of machinery and spare parts under HS codes 84 and 85 will also benefit the tea processing companies. However, these measures are inadequate to address the high cost of operation for exporters, emanating from other taxes and regulatory controls.

“The allocation of Rs. 400 million for export market access program under National Export Strategy (NES), and also further allocation of Rs. 250 million for implementation of NES, reiterates the Government’s commitment to promote exports, but the allocated amounts appear to be insufficient. “Further, consistent policies and regulations are necessary for the growth of the export industry. The plans to fast track FTAs with India, China, and Thailand, and also proposals to amend the labour laws to engage more women in the workforce, are in the right direction to support the business. “TEA welcomes the proposal to expedite the GI status for Ceylon Cinnamon in the EU, as it would benefit Ceylon Tea GI as well. However, it is necessary to expedite the legislation for local registration of GI, which has been pending for some years to facilitate local GI registration, which will eliminate any barriers for international registration.

“The Government has recognised that knowledge-driven skilled persons are key to economic growth in future. The proposal to launch scholarships for educational excellence to facilitate undergraduate education at internationally recognised prestige universities is a novel idea. This will certainly build up a team of young experts with knowledge and exposure, who could contribute immensely for the development of the country. “TEA also welcomes the “Home Sweet Home” Scheme to provide concessionary housing loans for middle-income youth, as having their own house will be a real incentive to begin their life.”