A recent report of a US complaint to the WTO regarding Sri Lanka's used-vehicle import tariffs has drawn scrutiny, with trade analysts unable to verify the claim in official WTO databases and questioning the motivation behind such action.

Reports surfaced recently that the United States has lodged a complaint with the World Trade Organisation regarding Sri Lanka's taxation and valuation methods for imported used vehicles, alleging they contradict international trade agreements. However, trade analyst Gomi Senadhira has cast doubt on these reports, stating that a search of the WTO database revealed no formal US complaint against Sri Lanka on this matter.

Senadhira notes that while the issue may have been raised informally in the WTO Committee on Customs Valuation or during Trade Policy Review discussions, such concerns are typically handled discretely between trading partners rather than escalated to formal complaints. He points out that Sri Lanka has historically addressed vehicle valuation issues collaboratively, particularly with Japan, the primary exporter of used vehicles to the island. The customs valuation framework has been in place since 2003, and minor infractions have been managed through bilateral negotiations.

The analyst raises concerns about potential underlying motivations. He notes that the United States is not a significant exporter of used vehicles to Sri Lanka due to the prevalence of left-hand drive vehicles in America, versus Sri Lanka's right-hand drive road standards. However, he observes that US luxury vehicles have become more visible on local roads in recent years. Senadhira expresses concern that Sri Lanka faces substantial revenue losses through trade misinvoicing in vehicle imports, with importers allegedly under-invoicing to reduce tax obligations.

Placing this issue in broader context, Senadhira references recent WTO complaints from China and Brazil against US reciprocal tariffs, which allege violations of core WTO principles. He suggests that if the US complaint against Sri Lanka is indeed formal, characterizing it as addressing a "minor infraction" while the US itself faces accusations of trade violations elsewhere would represent inconsistent application of trade rules.