Sri Lanka tea trade charges cess fund delays jeopardizing industry

August 24 (LBO) – Sri Lanka's tea trade, the island's main export earner, has said funds raised from a tax on exports are still not being ploughed back adequately to develop the industry despite numerous complaints. Delays and inadequate disbursements are hindering factory modernization work and tea promotion in highly competitive global beverage markets, exporters and the regulator said.

"The 1.2 billion rupee tea cess fund was not being adequately turned over to the industry," Tea Board Chairman Lalith Hettiarachchi said Thursday. "It ought to be ploughed back into the industry. The funds now go through the Treasury and are given as a dole to the industry. The funds arrive late and are usually less than what we ask for."

The funds, which are disbursed to industry stakeholders like the Tea Board, Tea Smallholders Development Authority and plantations firms, are becoming inadequate to pay salaries in the regulatory bodies.

"Salaries are going up but the cess funds are not going up as much," Hettiarachchi told a news conference held to announce an international tea convention being held next week.

"So money available for promotional purposes is getting lower and lower. The component available fo