Wednesday, 1 June 2022

How the increase in VAT affects the price of alcohol


Excise Commissioner Kapila Kumarasinghe has stated that the government has decided to increase the price of liquor due to the increase in the value added tax (VAT) with effect from yesterday (May 31).


Accordingly, some companies have increased the price of a bottle of liquor by Rupees. 520 and a can of beer by Rupees. 30.


The media spokesman said that the increase in VAT would increase the cost of production and that the rising amount could be passed on to the consumer by the goods manufactured by the manufacturer.


He said that as this is a non-essential product, the relevant agencies are free to set the selling price and it does not require the permission of a regulatory body.


Speaking further Mr. Kapila Perera said,


"When VAT is increased like this, the production cost of the producer goes up and the producer can increase the increased price due to that VAT from any consumer. Or charge a portion or bear the loss yourself without charging. It is called indirect tax because the consumer can charge it if he wants. Due to this nature how much will be increased according to the policy of each institution ”

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