The Plantation Industries Ministry says tax issues concerning the tea industry is currently being addressed at top government level along with several other issues.
Minister Navin Dissanayake and Tea Board Chairman Rohan Pethiyagoda have met Tea Exporter’s Association (TEA) representatives on numerous occasions to sort out their issues.
The Ministry was responding to a series of news items initiated by the TEA published last week.
The Ministry is of the view that certain aspects and facts have been left out so that a more complete and holistic view of the industry was not given and the TEA media release gives a totally negative view of the TEA industry which is incorrect.
The Ministry says that the Minister submitted a cabinet paper on the SVAT issue and it was decided by the Economic Subcommittee chaired by the Prime Minister to suspend the proposed new structure.
Under the current administration, a large amount of funds and development work are envisaged to the tea sector.
These include, the Development of the smallholder sector under funding from FAO, a US$ 65 million project already underway. “These funds will be the largest amount of funds received by the tea industry at particular moment of time.”
With regard to TEA’s concerns on the falling tea production, the Ministry says that it has been a case of concern for everybody.
In 2014 the highest tea production was reached at 340 m MT and since then 320 m MT and 292 m MT was recorded in 2015 and 2016. The Ministry says that while TEA gives the low figures for January and February this year it conveniently omits the fact that in March tea production came to normalcy as 26 million Mt was produced as the drought conditions were reversed.
To state that tea production has drastically come down is not correct as tea production is continuing in a stable manner.
When the current Minister took office tea prices were at an absolute rock bottom with a price range of Rs 400 to 450 and there was much protest, agitations and threat of social unrest if subsidies were not increased.
However today the prices have increased between Rs. 550 to 600 and a large sector of the tea industry is satisfied with the current situation. The government has despite financial problems maintained the fertilizer subsidy allocating Rs 1500 million for years 2016 and 2017 separately giving weight and importance to the small tea producer.
TEA has also raised the issue of the global tea campaign to be launched by the “export levy” on tea exports that is in place. The Minister and the Tea Board Chairman went out of their way to ensure these funds remain in the Tea Board as they realize the value and the need of a well targeted global campaign for Ceylon Tea. “Unfortunately government regulations and procedures have meant some unwanted delays have arisen.”
“It will be a pity if US$ 50 million is just spent for the sake of spending it. Therefore the ministry is confident that this campaign will begin in the next 3 to 4 months.”
“It will be more helpful to the industry than individual stakeholder organizations issuing media releases that portray a negative image about the Sri Lankan Tea Industry, the Plantation Ministry release said.
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