Some exporters to close shop if 2.5% ripped off turnover

Sri Lankan exporters feel that their earnings are being exploited through the new scheme of the government to cash in on 2.5 per cent of their turnover that could result in some exiting the country.

FTZ Manufacturers Association President Dhammika Fernando told the Business Times that some of the exporters were considering leaving the country if state schemes to grab 2.5 per cent of their turnover will go ahead as proposed in the budget, since this is “very huge”.

He noted that exporters wanted a discussion with the Central Bank on this issue and the forex conversion matter as well this week but no meeting was forthcoming.

He pointed out that the general sentiment among exporters is that the proposal to contribute 2.5 per cent of their revenues to the government was unfair since they are the sector generating earnings to the economy.

“This is a huge problem because exports will be an issue for the exporters,” he said adding that however, they still need to assess the impact of this proposal “but on face value this is dangerous.”

Mr. Fernando explained that this needs to be discussed with the authorities to find out the details of how the industry will be affected.

Some exporters are operating on very thin profit margins, he said, adding that some companies have already indicated that they are “seriously considering” moving out of Sri Lanka since “survival” will be a problem.