AKD Govt. no different, resorts to sin taxes to boost revenue

Wednesday, 15 January 2025 00:26 - - {{hitsCtrl.values.hits}}

President Anura

Kumara Dissanayake

Proving it is no different to previous regimes, the President Anura Kumara Dissanayake-led Government too has resorted to ‘sin taxes’ to boost revenue.

President Dissanayake, in his capacity as the Finance Minister on Saturday revised the excise duties on alcohol and cigarettes, widely known as “sin taxes.”

The pre-2025 Budget hike comes despite the country in 2024 achieving its highest Government revenue. In the first 11 months of 2024, Government revenue and grants rose year on year by Rs. 893 billion to Rs. 3.66 trillion. The Inland Revenue Department (IRD) last week announced it achieved the highest-ever tax revenue of Rs. 1.95 trillion in 2024. President Dissanayake will present the 2025 Budget on 17 February.

Under the new revisions, the excise duty on various types of alcohol produced was increased significantly. The updated tax rates are as follows:

Special arrack: Rs. 7,244 per litre.
Molasses, palm, coconut, and seasoned arrack: Rs. 7,752 per litre.
Locally produced foreign liquor: Rs. 7,969 per litre.

These changes impact nine categories of alcohol, leading to price hikes across several popular alcoholic beverages.

New alcohol prices:

Rock arrack: Price increased by Rs. 102, now costing Rs. 3,682 per bottle.

• Coconut arrack: Price increased by Rs. 109, now priced at Rs. 3,959 per bottle.

• Old arrack: Price increased by Rs. 109, now at Rs. 4,109 per bottle.

• Special old arrack: Price increased by Rs. 109, now costing Rs. 4,359 per bottle.

Additionally, beer prices have also risen:

• Low-alcohol beer: Increased by Rs. 30 per bottle.

• High-alcohol beer: Increased by Rs. 40 per bottle.

The price of locally produced foreign whiskey has also increased by Rs. 100 per bottle, while the prices of other foreign liquors will vary based on their alcohol content.

The Ceylon Tobacco Company (CTC) PLC also announced higher prices for cigarettes following the increase in Excise Duty.

The prices of Capstan and John Player cigarettes will increase by Rs. 5 per stick, while the 83mm Gold Leaf will see an increase of Rs. 10 per stick.