Sri Lanka mulls soda tax, raises duty on sugar imports

13-Jun-2017 - Last updated on 14-Jun-2017 at 09:33 GMT

Sri Lanka has become the latest country to consider the introduction of a specific tax on sugar.

The country’s health minister said the move is being considered in a bid to help reduce consumption to promote health.

“I stressed the need for increasing tax on sugar in 2015 with an objective of controlling non-communicable diseases,” Rajitha Senaratne said during a speech in Aluthgama.

He added that he still believes a higher tax on products high in fat and salt should also be levied to control NCDs.

Dr Senaratne said he had advised the government to increase tax on sugar at a time when 70% of all Sri Lankan patients at government hospitals die of NCDs.

At the same time, the country has increased the import duty on sugar to protect local cane growers as global sugar prices continue to fall.

The finance ministry said the “special commodity levy” on imported sugar has now been increased by SLR10 (US$0.065) a kilo last week, but stressed that the move would not have an impact on local selling prices.

Imported sugar currently costs SLR69 a kilo, compared to SLR89 last October, with duty now increasing to SLR23.

“The government intends to pass the benefit of this increased levy to the farmers engaged in sugarcane cultivation,” finance minister RHS Samaratunga said.