Sri Lanka’s Excise Department warned that anyone transporting beedi leaves (i.e. cheap, flake tobacco) without official transport permits will face immediate legal action, as authorities move to tighten enforcement against illegal production. Deputy Minister of Economic Development U. D. Nishantha Jayaweera said enforcement has been lax in the past, but new instructions have been issued to strengthen controls. While current tax revenue from domestically produced beedi stands at around 1–1.5 billion rupees ($3.4 million to $4.8 million), he said proper tax collection could raise this figure to nearly 15 billion rupees ($48 million). The government plans to introduce new measures to boost revenue and curb the untaxed, illegal manufacture of beedi.
Tag: Sri Lanka
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Sri Lanka Destroys $4 M in Illicit Cigarettes
Sri Lankan customs officials destroyed $4 million worth of illegally imported foreign cigarettes this week in Colombo. The cigarettes were confiscated in 2018, 2022, and 2024. According to customs spokesman Seevali Arukgoda, the authorities seized 8.7 million cigarettes during those three years.
Arukgoda said the agency plans to invest in modern equipment powered by artificial intelligence to improve container scanning and enhance contraband detection.
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Chandrasiri Joins Ceylon Tobacco Board
Image: Ink Drop BAT subsidiary Ceylon Tobacco Co. has appointed Samanmalee Chandrasiri as a non-executive director to its board, reports EconomyNext.
A globally experienced professional with nearly two decades of expertise in human resources, Chandrasiri started her career in 2006 with HR business partnering roles at BAT Sri Lanka.
As BAT South Asia area head of talent, she managed talent strategies across Pakistan, Bangladesh, and Sri Lanka. This led to her position as organization effectiveness advisor in BAT Indonesia.
She served as HR director for BAT Sri Lanka and for Malaysia and Singapore.
She assumed duties as group head of organization effectiveness and talent management in July 2019, operating from London.
Chandrasiri served as group head of HR for global marketing, scientific research and development before taking the role of group head of talent, organization effectiveness and inclusion (London), where she led the global center of expertise on talent, organization effectiveness, diversity and inclusion
In October 2024, she stepped into her current role as group head of HR and inclusion—global operations and R&D.
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Tax Collections Up Even as Smoking Drops
Image: eyegelb Sri Lanka managed to increase tobacco tax collections while reducing tobacco consumption over the past decade, reports Xinhua.
According to State Minister of Finance Ranjith Siyambalapitiya, tobacco consumption in Sri Lanka declined by 41.9 percent between 2015 and 2023. During the same period, the state’s revenue increased by 36 percent.
In 2015, Sri Lankans smoked 3.96 billion cigarettes, whereas by 2023, this figure had dropped to 2.3 billion cigarettes, Siyambalapitiya said.
Despite this reduction, the state’s revenue from cigarette taxes rose from LKR81.15 billion ($262 million) in 2015 to LKR110 billion in 2023, the state minister said.
In the past two years alone, cigarette consumption decreased by 17 percent, while tax revenue increased by 6 percent.
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New Year, New Taxes
Image: Xuejun Li Tobacco taxes increased in several countries at the start of 2024.
In Sri Lanka, an upward revision in excise duty and value added tax prompted market leader Ceylon Tobacco Co. to raise the price of four cigarette categories by LKR5 ($0.02), LKR15, LRK20 and LKR25 per stick, respectively, reports the Asian Mirror.
The government justified the tax hikes by its desire to boost revenue streams while discouraging tobacco consumption.
Azerbaijan, meanwhile, increased the excise rate for cigarettes from AZN38 ($22.35) per 1,000 sticks to AZN45.5 per 1,000 sticks, according to AzerNews. The excise rate for cigarillos went from AZN43 per 1,000 sticks to AZN45.5 per 1,000 sticks.
E-cigarettes and heated tobacco products are now subject to a tax of AZN16 per 1,000 units, compared with AZN14 per 1,000 units in 2023.
The excise rate for single-use electronic cigarettes, hookahs and their substitutes went up from AZN0.25 manats to AZN2.
In Belgium, as new e-liquid tax took of €0.15 per milliliter took effect on Jan. 1
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Sri Lanka Urged to Diversify Crops
Photo: Rawpixel.com The government of Sri Lanka should incentivize tobacco farmers to abandon the golden leaf if favor of alternative crops, according to a new publication from the Institute of Policy Studies or Sri Lanka.
The study, reported The Sunday Observer, notes that tobacco farmers can earn better profits from cultivating other crops such as chili, brinjal, carrot, bitter gourd, cabbage and big onion.
In 2017, the government declared it would ban tobacco farming in Sri Lanka by the end of 2020. While its deadline has lapsed, leaf cultivation has declined significantly in recent years. In 2020, 1,142 hectares, or 0.04 percent of Sri Lanka’s agricultural land, was dedicated to tobacco, according to the most recent statistics. Production totaled 9,224 metric tons that year.
Among other recommendations, the study authors suggest building farmer resilience and strengthening the policy frameworks for alternative crops.
These supply-side measures, they argue, could be complemented with demand-side measures to disincentivize the manufacturers from engaging in tobacco production and prevent nontobacco farmers from joining the industry.
The also called for higher tobacco taxes and more awareness of the adverse health effects of tobacco consumption.
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Sri Lanka Increases Tobacco Duty
Image: MaciejBledowski | Adobe Stock The government of Sri Lanka increased the excise duty on alcohol and cigarettes by 20 percent, according to the Xinhua News Agency.
State Minister of Finance Ranjith Siyambalapitiya said the duty was raised to increase state revenue and discourage alcohol and cigarette consumption. In 2021, Sri Lanka collected LKR249.6 billion ($687 million) in taxes from alcohol and tobacco products, according to Siyambalapitiya.
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Sri Lanka Mulls Cigarette Price Increase
Photo: MemoryMan Sri Lanka may increase the price of cigarettes as part of its upcoming budget, according to the National Authority on Tobacco and Alcohol (NATA), reports Sri Lanka Mirror.
A suggestions has also been put forward to ban the retail sale of single cigarettes in Sri Lanka. The objective of this proposal is to reduce the number of people who smoke.
Meanwhile, a survey jointly conducted by the Department of Census and Statistics, NATA and the Ministry of Health has revealed that 51 percent of adults who smoke in Sri Lanka believe that they should quit smoking.
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Sri Lanka Plans Annual Tobacco Tax Hikes
Photo: sezerozger Sri Lanka’s National Authority on Tobacco and Alcohol (NATA) wants to change taxes so that cigarette prices increase by 6 percent each year, reports The Island.
The proposed tax formula comprises six components––cigarette tax percentage, proposed price for next year, inflation, present price, GDP and the “externality factor” of 4 percent.
“The 4 percent is added to ensure that the price of a cigarette is increased every year even if inflation drops to zero,” said Samadhi Rajapaksa, Chairman, NATA.
Rajapaksa noted that Sri Lankan depends less on tobacco tax revenue than many people believe. “Our tax revenue from these sources is about 11 percent only,” he said.
Earlier, Rajapaksa said that the NATA would increase the minimum age for sale, purchase and promotion of tobacco products from 21 to 24 in 2022.
Rajapaksa told the media that NATA had decided to amend the National Authority on Tobacco and Alcohol Act this year.
The increase of the minimum age for sale, purchase and promotion of tobacco products was one of the proposed amendments to the Act, he said.
“Already advertising, promotion and sponsorship of tobacco is prohibited. We want to stop the cross border advertising of tobacco products, too,” he said.