A probe by the parliamentary watchdog, the Committee on Public Accounts (COPA), has revealed a significant misuse in the process of issuing licenses to import fully electric vehicles by Sri Lankans working abroad, based on foreign remittances.

The investigation found malpractices, including some importers holding over 600 electric vehicle licenses, as well as licenses being issued to individuals who had not travelled abroad during the relevant period.

The COPA probe, chaired by MP Aravinda Senarath, uncovered evidence that raised suspicions of money laundering in the issuance of licenses.

The Auditor General pointed out that the government lost Rs. 2.42 billion in tax revenue due to an increase in the luxury tax exemption limit for 921 vehicles imported up to September 30, 2024.

The Committee also discussed special audit reports related to a scheme, implemented between May 1, 2022, and September 15, 2023, which granted permits for the importation of fully electric vehicles for Sri Lankans employed abroad, based on foreign remittances.

The Auditor General revealed that 1,077 vehicle permits were issued during this period, of which 77 permits were later cancelled. He also noted that two main institutions acted as importers, providing facilities for 640 permit holders. This suggested that a business had been created under the guise of permit issuance.

Furthermore, due to an increase in the luxury tax exemption threshold, from Rs. 6 million to Rs. 12 million for 921 vehicles imported until September 30, 2024, the Auditor General stated that the government lost tax revenue amounting to Rs. 2.42 billion.

It was also revealed that four individuals, who had not travelled abroad during the relevant period, had been issued electric vehicle permits. Since the circular relevant to this scheme did not specify a minimum duration of overseas employment required for eligibility, individuals, who had been abroad for as little as three days or up to three months, as well as those who travelled intermittently, were granted permits. The Ministry of Labour and Foreign Employment had acted under this scheme before it was revised.

Deputy Ministers Maj Gen (rtd.) Aruna Jayasekera, Nalin Hewage, Sugath Thilakaratne, and MPs Kabir Hashim, Dr. M.L.A.M. Hizbullah, Chandana Sooriyaarachchi, Sagarika Athauda, Oshani Umanga, Dinindu Saman Hennayake, T.K. Jayasundara, Manjula Suraweera Arachchi, Ruwanthilaka Jayakody, Lal Premanath, and several government officials attended the meeting.

by Saman Indrajith