Sri Lanka propels green initiative with zero Custom tariffs on electric vehicles

Wednesday, 13 September 2023 00:36 - - {{hitsCtrl.values.hits}}

Scope to include electric two-wheelers with a power grade of up to 500 kW, partially assembled SKD sets with an engine capacity of up to 3000 CC
Investors must commit a minimum of $ 50 m towards manufacturing of e-vehicles or plug-in hybrid vehicles

With the aim of encouraging domestic production of electric vehicles (EVs) and advancing sustainable transportation, the Cabinet this week approved a zero customs tariff on the CIF value for imported electric vehicles.

The move extends its ambit to include electric two-wheelers with a power grade of up to 500 kW, as well as modern partially assembled Semi-Knocked-Down (SKD) sets with an engine capacity of up to 3000 CC. These sets are earmarked for the assembly of plug-in hybrid vehicles.

“To be eligible for this incentive, investors must commit a minimum of $ 50 million towards the manufacturing of electric vehicles or plug-in hybrid electric vehicles. The initiative applies to companies that are either already engaged with the Sri Lanka Board of Investment (BOI) or are entering into new agreements,” Co-Cabinet Spokesman and Minister Bandula Gunawardena said at the post-Cabinet meeting media briefing yesterday.

He said this forward-thinking policy aligns Sri Lanka with the progressive stance adopted by many Asian countries, who have similarly implemented zero custom tariffs for EV assembly and manufacturing. “By removing financial barriers, this initiative seeks to attract investors and manufacturers to partake in the burgeoning greener transportation alternatives,” he added.

The proposal to this effect submitted by President Ranil Wickremesinghe in his capacity as the Finance, National Policies and Economic Stabilisation Minister was approved by the Cabinet of Ministers at its meeting on Monday.