News
Corrupt elements use Parliament, Finance Ministry to evade taxes
Economic Oversight Committee Chief makes shocking allegation
Complicity of official owning Las Vegas house exposed
by Shamindra Ferdinando
Chairman of the Sectoral Oversight Committee on National Economic and Physical Plans Mahindananda Aluthgamage, MP, yesterday (01), said influential corrupt elements within the state revenue collection apparatus had with the help of the Finance Ministry brought in amendments to relevant laws to stifle the revenue collection process. Their actions had taken a heavy toll on the state coffers.
The government had created a system that allowed four appeals against Inland Revenue Department tax estimates, MP Aluthgamage explained, alleging that interested parties abused the parliamentary process.
The former Minister said so in response to the queries raised by The Island about his recent declaration at the Presidential Media Centre (PMC) that a special unit was required to monitor Inland Revenue, Customs and Excise Departments.
Asked whether he had sought to highlight the failure on the part of parliamentary watchdog committees, the COPE (Committee on Public Enterprises), the COPF (Committee on Public Finance) and the COPA (Committee on Public Accounts), relevant ministerial consultative committees as well as the Auditor General to carry out their duties and functions properly, Aluthgamage said the fact that as much as Rs. 904 bn had not been collected as taxes over the past 15 years proved that the existing systems were flawed.
MP Aluthgamage said: “In fact, the government, at the expense of the national economy created a system for the benefit of tax dodgers. Parliament is responsible for this situation. Four appeals are not allowed in any part of the world. But the Finance Ministry and Parliament created systems that can be manipulated because the corrupt elements receive the backing of the powers that be.”
Responding to another question, MP Aluthgamage said those who had been tasked with revenue collection seemed to have been hand in glove with tax dodgers.
Aluthgamage said his committee had recently requested President Ranil Wickremesinghe, who also holds the Finance portfolio, to reduce the number of tax appeals from four to two.
MP Aluthgamage said that he had realised the urgent need for a fresh and thorough inquiry into state finance following the declaration of bankruptcy in May 2022 and the ouster of President Gotabaya Rajapaksa two months later.
The former Minister said that he wouldn’t hesitate to admit that corrupt systems remained in place regardless of the change of government in July last year. “A few months ago, a person known to me was asked to pay Rs 100 mn as tax. He got in touch with a senior revenue official, paid him Rs 10 mn and got the matter settled. When I brought this to the notice of the relevant department head, the official concerned simply said that particular officer often did so.
“Obviously regardless of the change of government and the fact that the country is begging for IMF assistance, corruption is rampant,” MP Aluthgamage said, noting that though the country was bankrupt and experienced continuing turmoil the vast majority of those who were tasked with revenue collection lived cushy lives. The Oversight Committee Chairman disclosed that one of the key Inland Revenue officials owned properties in Las Vegas, whereas another top official had walked free after being caught with heroin.
Alleging that some of those holding key positions in the revenue collection set-up collaborated with tax dodgers, the MP said that similarly the Excise Department and liquor manufacturers perpetrated massive tax frauds. Responding to another query, MP Aluthgamage emphasised that actually the increase in the price of liquor had helped certain liquor manufacturers.
Appreciating the interventions made by MP Patali Champika Ranawaka to pressure the Excise Department to do its job, MP Aluthgamage said that routine checks had revealed the widespread use of fake security tax stamps affixed to bottles of liquor countrywide. The Excise Department bosses should be held accountable for this situation as liquor manufacturers could not engage in such massive frauds without the blessings of the department.
Referring to a delay in agreement with the IMF over the releasing of the second tranche of USD 2.9 bn Extended Fund Facility (EFF), MP Aluthgamage said that the flaws in the revenue collection process, too, had contributed to the situation. The MP alleged the Inland Revenue, Customs and Excise Departments continued to undermine the revenue collection. “They always come up with lame excuses to thwart efforts to streamline tax collection,” he said.
Alleging that frauds involving the Excise Department and liquor manufacturers caused 40 percent loss in revenue, MP Aluthgamage alleged that a significant amount of that money ended up with Excise Department personnel at all levels. “This is the sad truth,” the ex-Minister said.
According to him, the Inland Revenue, Customs and Excise were required to collect Rs. 1,667 bn, Rs 1,217 bn and Rs 217 bn, respectively, this year. But so far this year, they had collected only Rs 956 bn, Rs 578 bn and Rs 109 bn, respectively, MP Aluthgamage said.
MP Aluthgamage said that he had been targeted by Inland Revenue after he raised the issues at hand publicly. “I was investigated,” the MP said, adding his efforts couldn’t be derailed by such efforts.
MP Aluthgamage said that he had urged President Wickremesinghe to take remedial measures as soon as possible. “Our continuous failure to act even after the declaration of bankruptcy is unacceptable.”
News
FSP warns of possible coal shortage
“No shipment for 10 days; seas off western coast will become rough by April end”
Education Secretary of the Frontline Socialist Party (FSP) Pubudu Jayagoda says the Indian company which secured a tender to supply coal for electricity generation this year has delivered only 13 of the 25 shipments required and no vessel has arrived in Sri Lanka for the last 10 days or so.
Jayagoda said so while addressing the media during a protest held in Colombo yesterday.
Jayagoda said the Indian company Trident Chemphar, which secured the tender to supply 25 coal shipments for 2026, had placed the country’s coal stocks at risk.
Although all 25 coal shipments are required to be unloaded before the end of April, only 13 vessels have arrived in Sri Lanka so far, according to Jayagoda. He also claimed that no shipment had arrived during the first week of March, adding that coal vessels had not arrived for about 10 days.
Jayagoda warned that the situation could endanger the country’s energy supply as the seas off the western coast usually turn rough by the end of April, disrupting unloading operations.
According to Jayagoda, a report submitted by the Public Utilities Commission of Sri Lanka to the Parliamentary Oversight Committee on infrastructure and strategic development, power cuts may become necessary from August even if the country falls short of five shipments unless electricity is generated using costly diesel-powered thermal plants.
Jayagoda also alleged irregularities in the tender process, claiming that the government had changed tender specifications and delayed the tender process by about four months, possibly to allow the Indian company time to register and secure performance guarantees.
He further alleged that the coal supplied by the Indian company was substandard.
Jayagoda questioned why the tender had not been cancelled despite several shipments allegedly failing to meet quality standards and why no investigation had been launched.He asked why legal action had not been taken against the company despite supply disruptions.
News
Repatriation of Iranian naval personnel Sri Lanka’s call: Washington
The US Department of State has said that Washington respects Sri Lanka’s sovereignty in handling matters relating to the Iranian warship IRIS Bushehr and its crew, according to agency reports, quoting a State Department Spokesperson. He has said the final decision regarding the vessel, its crew and the rescued Iranian sailors rests with Sri Lanka in accordance with its domestic laws and international legal obligations.
The statement follows comments by Foreign Minister Vijitha Herath that Sri Lanka was looking after 32 sailors rescued from the Iranian frigate IRIS Dena under Colombo’s international treaty obligations.
The frigate was sunk by a US submarine off Sri Lanka’s southern coast on Wednesday during escalating hostilities involving the United States and Iran.
Sri Lanka’s Navy conducted rescue operations, following the incident, recovering 84 bodies.
Asked whether Colombo was under US pressure not to repatriate the Iranian sailors, Herath said Sri Lanka had taken all actions in accordance with international law.
Sri Lanka also provided safe harbour to the second Iranian warship, IRIS Bushehr, and evacuated its 219 crew members a day after the Dena was torpedoed. The vessel was taken to the port of Trincomalee after reporting engine problems.
Citing an internal cable, Reuters reported that Washington had urged Sri Lanka not to repatriate the Iranian sailors. However, the State Department spokesperson reiterated that the disposition of the crew and survivors was a matter for Sri Lanka to decide, adding that the United States respects Sri Lanka’s sovereignty in managing the situation.
Meanwhile, India allowed a third Iranian warship, IRIS Lavan, to dock in a port on humanitarian grounds after it reported operational difficulties.
The ship docked at the port of Kochi, where many of the crew, including young cadets, were disembarked and transferred to a nearby facility.
President Anura Kumara Dissanayake said Colombo would follow the provisions of the Hague Convention, which requires neutral states to detain combatants of warring parties until the end of hostilities.
A senior administration official said Sri Lanka was in discussions with the International Committee of the Red Cross regarding the treatment of survivors from the torpedoed vessel. International humanitarian law would apply to the wounded, who could be repatriated if they requested it, the official added.
Iranian diplomats in Colombo have requested the return of the remains of sailors killed in the attack to Iran.
News
Indian Ocean must remain peace zone: Sajith
Opposition and SJB leader Sajith Premadasa, emphasised the critical need for the Indian Ocean region to remain peaceful and not become part of any conflict, said a news report published by NDTV yesterday.
It said: As the Iran-Israel war enters its second week, the theatre of the war has expanded dramatically, reaching the waters of Sri Lanka. With the sinking of Iranian warship IRIS Dena in international waters off Lanka’s coast and the docking of a second Iranian vessel, IRIS Busheher, Colombo has become embroiled in a conflict where it seeks to remain only a neutral bystander.
Speaking with NDTV, Sajith Premadasa, Leader of the Opposition in Sri Lanka emphasised the critical need for the Indian Ocean region to remain peaceful and not become part of any conflict.
“The Indian Ocean has on successive occasions been declared a peaceful area and should remain so,” said Premadasa.
The Sri Lankan government has said that it will attend to all survivors of the ill-fated IRIS Dena and IRIS Busheher as per international protocols and norms. Sri Lankan President Anura Kumara Dissanayake said his country had a “humanitarian responsibility” to take in the crew of the vessel, which was allowed to dock at Trincomalee in Northern Sri Lanka.
Premadasa, who is the leader of the opposition party SJB, called on all parties to cease the ‘asymmetric warfare’. He cautioned that the widening conflict would have devastating consequences for smaller countries like Sri Lanka, which is still reeling from its worst economic crisis in 2022.
“The Middle East conflict is already spreading to other countries, and this is having an impact on Sri Lanka and Sri Lankan people,” Mr Premadasa told NDTV.
A third Iranian vessel that was in the Indian Ocean, IRIS Lavan, has docked at Kochi in India. India has said it was a “humanitarian call” after the vessel sent out a distress call.
-
News3 days agoUniversity of Wolverhampton confirms Ranil was officially invited
-
News4 days agoLegal experts decry move to demolish STC dining hall
-
News3 days agoFemale lawyer given 12 years RI for preparing forged deeds for Borella land
-
News2 days agoPeradeniya Uni issues alert over leopards in its premises
-
Business5 days agoCabinet nod for the removal of Cess tax imposed on imported good
-
News3 days agoLibrary crisis hits Pera university
-
News2 days agoWife raises alarm over Sallay’s detention under PTA
-
Business5 days agoWar in Middle East sends shockwaves through Sri Lanka’s export sector
