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Sri Lanka tobacco allowance threat to arrivals storeSri Lanka tobacco allowance threat to arrivals store
Gavin Lipsith
31-Mar-2006
A proposal to abolish Sri Lanka's inbound tobacco allowance could end tobacco sales at Alpha Orient Lanka's Colombo arrivals outlet
The Sri Lankan government is considering a proposal to abolish the country's inbound duty-free tobacco allowance, a move that would effectively end tobacco sales at Alpha Orient Lanka's arrivals duty-free store in Colombo. The move is part of measures intended to boost the local market, where British-American Tobacco is the only domestic manufacturer of cigarettes, although campaigners told DFNI Asia that the proposal would damage the country's attraction to tourists.Sri Lanka Customs director-general Sarath Jayatilake said abolishing the allowance would stop duty-free cigarettes from finding their way onto the domestic market, protecting the revenues of the local producer, which contributes about Rs2bn in tax revenue each month. Alpha Asia managing director Paul Topping said that the company was in discussions with the government and hoped to avoid the change.
"Sri Lanka and many other Asian countries benefit from being able to offer tourists tobacco on arrivals," said Topping. "This would be a backward step, and I don't believe it would stimulate the local market. The brands sold in our stores are made in the US or Europe, while those on the domestic market are made locally."
Topping added that tobacco was a small but significant part of the product mix in Alpha's Colombo arrivals store, and that it is important as a penetration driver and a service to tourists.
The current inbound tobacco allowance stands at 200 cigarettes, 50 cigars or 200 beedis – handmade cigarettes popular around the Indian sub-continent.
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(1-Apr-2006) - The Sri Lankan government is considering a proposal to abolish the country's inbound duty-free tobacco allowance, a move that would effectively end tobacco sales at Alpha Orient Lanka's arrivals duty-free store in Colombo
(31-Mar-2006) - Sources confirm that the Sri Lankan government has carried out its threat to prevent tourists and returning nationals from purchasing tobacco at the country's arrivals duty-free stores
(1-Apr-2006) - SRI LANKA. Tourists and returning nationals will be unable to purchase tobacco products at Sri Lanka's arrivals duty-free stores or on board flights into the country from April 1
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(15-Jul-2006) - Industry campaigners are awaiting clarification on a bill that could threaten self-service sales of tobacco products throughout Sri Lanka