This piece serves as a gambit to a relatively unpopular budgetary reform that should be pushed through. In Sri Lanka as in the rest of the world the vehicle is a status symbol. It’s role as a status symbol is however more pronounced in Sri Lanka. High duty, petrol costs, and realizable value in the secondary market make the vehicle a reliable indicator of wealth. The significant costs in owning a vehicle combined with the considerable ease with which it can be offered as collateral make it popular as an asset class amongst businessmen. Businessmen also use the transferability of the asset class to cover taxable income or unexplained wealth. Vehicles are the preferred form of collateral outstation (any region outside the Western Province) indicating problems with financial deepening and distribution.
True on so many levels
One must consider vehicle drivers, owners, service providers, financiers, and then agents from a social lens. Revisiting the list, one sees that they are ordered in ascending order in terms of wealth. Ishara Chinthaka Nanayakkara, Indra Silva, the Yaseen family, David Pieris, and Arthur Senanayake come to mind. It is my sense that vehicle dealing has overtaken tea as a creator of disproportionate wealth. This is odd as it doesn’t take much in the way of intelligence to import and then sell a vehicle. People notice vehicles. The school run of the British School of Colombo is a significant eye sore to those averse to gaudy displays of wealth by the newly rich. One would imagine that there is a daily gala occurring at the WTC by observing the way in which people roll up to work. There is considerable social angst against this.
False on the most significant one
Vehicles are a signifier of individual wealth. They are not however a signifier of societal wealth. A vehicle is only as important as it is in Sri Lanka when your infrastructure is poor. Wealthy nations have efficient public transport used by a considerable portion of their population. Rich Sri Lankans will still have to feel poor amongst their foreign counterparts who have more equitable taxation and better mobility. We must start to think of vehicle taxation as part of wealth distribution and more importantly as part of a wider transport policy.
Please share your ideas by commenting to help formulate this idea into a budget suggestion.