Cess to be phased out

2026-03-04 - 15:58

Cess, along with other non-customs import levies, has historically been imposed continuously and expanded with the objectives of protecting selected domestic industries and generating government revenue. As a result, particularly for intermediate and applied goods, high import costs have increased production expenses for export-oriented industries. This situation has reduced the competitiveness of Sri Lankan products in international markets and constrained export-led economic growth. Therefore, to reduce production costs, enhance export competitiveness, support industrial development and value addition, facilitate trade, provide ease of commercial activity, ensure a level playing field for all stakeholders, and align with internationally recognised practices and World Trade Organisation (WTO) policies, it has been planned to phase out this cess. Accordingly, the phased removal of cess on goods imported under 2,634 identified combined tariff codes over four years from 2026 to 2029 has been approved by the Cabinet. This follows the joint proposal presented by the Honourable President, in his capacity as Minister of Finance, Planning and Economic Development, and the Minister of Industry and Entrepreneurship Development.