By Rathindra Kuruwita

Thousands of jobs in Sri Lanka’s book publishing industry will be lost due to the imposition of VAT (18%) on books publishers claim.They claim that about 30 percent of bookshops have been closed due to the economic crisis.

There had been no taxes on books before 01 January 2024, Sri Lanka Book Pub lish ers Asso ciation (SLBPA), President Samantha Indeewara, said.The book publishing industry was in crisis even before the imposition of VAT, he added.

“The prices of all raw materials have increased. For example, the price of paper has risen by 300 percent in the past few years.”

“Books and stationery prices will increase by more than 20 percent. The income of parents has not risen. What will they do? Children’s education will suffer.”

Indeewara said Sri Lanka imported at least 90 percent of the inputs needed to produce a book. All of them were subjected to VAT and other import duties.”However, the final product was not subjected to VAT earlier.”

Indeewara said book sales had dropped in the 1990s, with the spread of electronic media. Book publishers started the Colombo International Book Fair to reverse the trend.

“But in recent years, book sales have dropped again because of the economic crisis.

SLBPA former President Vijitha Yapa said that when Ranil Wickremesinghe was Prime Minister in 2002, he proposed a tax on books. However, the government had withdrawn the proposals due to protests from the book publishers.

“In 2016, Wickremesinghe again attempted to impose a tax on books. When Wickremesinghe came to the Colombo International Book Fair that year, as the Chief Guest, we again urged him not to impose a tax. The proposal to impose taxes on books was again withdrawn,” he said.

Yapa mentioned that in September 2023, they had heard the government was planning to impose VAT on books. The book industry representatives met the President and inquired about the possible tax.

“The President said nothing was set in stone and that we would have an opportunity to discuss the matter. He told us that the IMF wanted him to impose a tax on books.”

Despite the assurances, the book industry didn’t get an opportunity to discuss the impending taxes with the government, he said. The industry representatives wrote to the President, and his chief of staff, Sagala Ratnayake, said he would inform the President.

“Later, we were asked to talk to the IMF. Then we wrote to the IMF. It has been two months; there has not been a reply from the IMF.”

Yapa said that from what he knows, no other South Asian nation has imposed VAT on books.

“Some publishers only print about 500 copies of a book,” he added. “Earlier, we used to print thousands of copies. Prices of books are now high because we print less. There are no economies of scale. Printing books is so expensive here that people actually print books abroad and bring them here. It’s cheaper for them to pay import taxes than to print in Sri Lanka. Thousands of jobs will be lost.”

Yapa went on to say that 30 percent of bookshops have closed down already, and more shops will go out of business soon.

“We don’t know how much the government is trying to make by taxing us. We don’t know, and they won’t tell us.”

President of the Ceylon Booksellers Importers And Exporters Association, Dinushi Abeywickrama, said the text books they import for students sitting for foreign exams have tripled in price.

“Families with a few kids are seriously affected by this. Parents can’t buy. Earlier, parents used to come and buy the entire set of text books for their kids. Now they buy these books on a staggered basis. Most parents try to see if they can get the text book photocopied,” she said.

The government is violating the Agreement on the Importation of Educational, Scientific and Cultural Materials (also known as the Florence Agreement), she said.

Abeywickrama added this is a 1950 UNESCO treaty whereby states agree to not impose customs duties on certain educational, scientific, and cultural materials that are imported.

“We are a party to that agreement,” she said, adding that the President is a well-read person and that he has used the knowledge he has gained from reading to make a name for himself in the world.

“I, therefore, urge him not to deprive other people from learning and improving themselves by reading books,” she said.