Colombo, June 6, 2025 — Sugar importers have issued a strong appeal to President and Finance Minister Anura Kumara Dissanayake, warning that any hike in the current sugar import tax would lead to a steep increase in consumer prices and disrupt the market balance.
At present, Sri Lanka imposes a Rs. 50 per kilogram tax on imported sugar—a rate introduced by the previous administration to protect local producers such as Pelawatte and Sevanagala. This is a sharp contrast to earlier years when the tax stood as low as 25 cents per kilo. With the country importing approximately 60,000 metric tons of sugar each month, the existing tax contributes around Rs. 3 billion to state revenue.
However, industry sources claim that several large-scale importers—who are currently holding around 60,000 metric tons in storage—are lobbying, via intermediaries, to raise the tax to Rs. 80 per kilo. Critics argue that such a move would hand these importers an immediate windfall of Rs. 1.8 billion in profit from their existing stock, without any added cost.
Small and medium-scale importers, who have depleted their stocks and await new shipments, say the proposed tax hike would severely disadvantage them. Unlike larger players, they lack the storage capacity and financial buffer to absorb sudden tax shocks.
“If the tax is increased, everyday essentials like tea, sweets, bakery goods, and soft drinks will become more expensive,” one importer warned. “Consumers will be forced to bear the cost of a decision that only benefits a few.”
Importers also pointed out that local sugar production meets only 10% of national demand and consists primarily of unrefined brown sugar, which is unsuitable for industrial use in sectors like confectionery and beverages.
They emphasized that the current Rs. 50 tax is already high by global standards and that any further increase could trigger artificial shortages, distort market dynamics, and place unnecessary financial stress on the public.