State Minister Ajith Nivard Cabraal says the government is incurring a loss of Rs.572 million monthly due to the tax concessions provided to companies that import milk powder on the 11th of August, in order to prevent them from increasing prices.
The State Minister said this indicates the governments intent to ensure the price of milk powder remains unchanged.
State Minister Cabraal speaking during the adjournment debate in Parliament yesterday said, 80% of the country’s milk powder demand is met through imports.
He added the government slashed the Rs.15 Customs tax per kilogram of milk powder and the Rs.2.50 Ports and Airports Development tax in order to maintain milk powder prices at its previous rate.
While acknowledging that state revenue has dropped significantly as a result, the State Minister said the move will ensure one kilogram milk powder packet is sold at Rs.945 and a 400g packet at Rs.380.