Green cars and red light for Sri Lanka

The flood of electric cars may be a dream come true for a well-heeled few, but do they really contribute to a cleaner environment or fill state coffers in the same way as other motorists?

- Amal Jayasinghe

Electric cars are more expensive than petrol or diesel-powered vehicles, which means more foreign exchange leaves the country to import an electric vehicle (EV). The tariff on an EV is also much lower than that on a fossil fuel-powered vehicle. As a result, the state earns far less tax revenue on every dollar spent to bring in an EV.

While the prohibitive 200%+ tax on diesel and petrol vehicles is aimed at discouraging their imports, the state derives the bulk of its revenue from them.

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