📈 Vehicle Prices to Surge Amid 2.5% Tax Hike & Global Price Trends

The Vehicle Importers’ Association of Sri Lanka (VIASL) has warned of a significant rise in vehicle costs starting 1 April 2026. The increase is driven by new tax policies and external market pressures. • New Tax Impact: A 2.5% Social Security Contribution Levy (SSCL) on imported vehicles will take effect this April. For a vehicle valued at Rs. 10 million, this adds roughly Rs. 250,000 to the retail price. • Customs Collection: The levy will be collected directly by Sri Lanka Customs at the point of import. Importantly, vehicles currently being cleared are exempt from this new charge. • Global Market Trends: Second-hand Japanese vehicles have seen auction prices spike by 11% to 15% recently. This is attributed to the emergence of new export markets for Japan’s used vehicles, tightening global supply. • Sector Outlook: Despite rising costs, local demand remains strong. However, mid-range models (1,000cc–1,500cc) like the Honda Vezel and Toyota Raize are seeing the sharpest price movements, while entry-level models like the Suzuki Wagon R face affordability hurdles due to the 50% Loan-to-Value (LTV) ratio.