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.”
Latest News
Our goal is to build a “Thriving Nation” where a woman can walk without fear or doubt, where her talents are duly recognized, and where she can lead a life of dignity – PM
The PM’s message:
Women are the true pillar of Sri Lankan society and economy. The role they play within the family and in society has today become a decisive factor in shaping the future of our nation. Through the Government’s policy statement, “A Thriving Nation – A Beautiful Life,” we envision going beyond treating women as mere beneficiaries and recognizing them as active partners in national development, ensuring that they receive the dignity and opportunities they rightfully deserve.
Within our policy framework, special focus has been placed on women. We are committed to recognizing the economic contribution extended by women as housewives, promoting women’s entrepreneurship, and expanding access to the technical and financial support necessary for self-employment alongside strengthening the legal framework required to ensure women’s safety in public transport, workplaces, and within the family environment. Further, we are taking steps to create the environment to increase women’s representation in decision-making bodies at national and regional levels. Special attention is also being given to implementing targeted programmes aimed at improving women’s nutrition, reproductive health, and mental well-being.
Women are not a group seeking sympathy; they are vital social partners endowed with intelligence, resilience, and creativity. Our goal is to build a “Thriving Nation” where a woman can walk without fear or doubt, where her talents are duly recognized, and where she can lead a life of dignity
On this International Women’s Day, I sincerely hope that it marks the beginning of a new era in which the aspirations of all women in our country are realized as they shine before the world.
Latest News
Heat Index at Caution Level in the Sabaragamuwa, North-western and North-central provinces and in Colombo, Gampaha, Vavuniya, Mannar, Hambantota and Monaragala districts
Warm Weather Advisory issued by the Natural Hazards Early Warning Centre of the Department of Meteorology at 3.30 p.m. on 07 March 2026, valid for 08 March 2026.
Heat index, the temperature felt on human body is likely to increase up to ‘Caution level’ at some places in the Sabaragamuwa, North-western and North-central provinces and in Colombo, Gampaha, Vavuniya, Mannar, Hambantota and Monaragala districts
The Heat Index Forecast is calculated by using relative humidity and maximum temperature and this is the condition that is felt on your body. This is not the forecast of maximum temperature. It is generated by the Department of Meteorology for the next day period and prepared by using global numerical weather prediction model data.

Effect of the heat index on human body is mentioned in the above table and it is prepared on the advice of the Ministry of Health and Indigenous Medical Services.
ACTION REQUIRED
Job sites: Stay hydrated and takes breaks in the shade as often as possible.
Indoors: Check up on the elderly and the sick.
Vehicles: Never leave children unattended.
Outdoors: Limit strenuous outdoor activities, find shade and stay hydrated.
Dress: Wear lightweight and white or light-colored clothing.
Note:
In addition, please refer to advisories issued by the Disaster Preparedness & Response Division, Ministry of Health in this regard as well. For further clarifications please contact 011-7446491.
News
Lanka tea industry may lose $ 10-15 mn per week from ME war
The ongoing military conflict in the Middle East has adversely impacted on the Sri Lankan tea industry as the exporters are unable to supply tea to the region. The exporters estimate the revenue loss at about $ 10-15 million per week. The exporters have orders in hand for supply of tea and it is the logistical issues and war risk preventing them fulfilling such orders, the Tea Exporters Association (TEA) said in a statement.
“In order to mitigate the impact on the industry, the tea industry has jointly requested the government to support it in addressing the cash flow issue and consider absorbing a part of the additional freight and insurance charges. It has also requested government intervention to obtain the balance payment of about $ 50 million due on tea shipments already made to Iran under the barter deal,” TEA said on Friday.
The statement said approximately 52% of Sri Lanka’s tea exports reach the affected region mainly coming from the low grown area of the country dominated by tea smallholder farmers. According to 2025 tea export statistics, about 125 million kilograms of Ceylon tea were exported to the Middle East, with an estimated value of USD 750 million. The major importing countries of Ceylon Tea in the region include Iraq, Iran, Libya, Turkey, Saudi Arabia, Syria, and the United Arab Emirates. Though Libya and Turkey can be reached via Africa, the exorbitant freight charges have prevented the buyers in those countries from importing tea at the moment.
The supply routes to Middle East countries go via Strait of Hormuz and Red sea Suez Canal. Although there is no blockade on Suez Canal, due to the war risk both channels are currently not used by the major shipping lines. The tea exports to the region have almost come to a standstill due to the following reasons:
=All major shipping lines suspended their services to the region immediately after the outbreak of the conflict.
=Several seaports in the region were temporarily closed during the initial stages.
= Although a few shipping lines resumed limited operations from March 4, freight charges have
increased significantly by approximately USD 1,800 for a 20’ container and USD 3,000 for a 40’ container.
= Existing insurance coverage obtained by exporters is no longer valid.
=There is a lack of regular and scheduled vessels operating from Colombo to Middle Eastern destinations.
The tea exporters are experiencing serious cash flow constraints, as payments for shipments already
dispatched have been delayed due to the unsettled situation in the region. This has restricted exporters’
buying capacity and that was evident at this week’s tea auction, where overall prices declined by about Rs. 50/ per kg while low grown tea prices declined by about Rs. 75/ per kg.
If the situation continues for few more weeks it will have a serious impact on the tea auction as buyers may curtail the purchase of tea if the outward movements are restricted. This could directly impact on the income of the tea smallholder farmers.
In January 2026, the country earned $ 121.8 million from tea exports compared to $ 112.7 million in January 2025 (a 5% increase). The figures for February 2026 are not yet available but should be either similar to last year or higher. The disruption to tea exports in March will certainly affect the volume and value of the exports though the exact amounts cannot be estimated at this point.
According to the available data Sri Lanka has settled about 95% of its debt to Iran by supplying tea to Iran under the Tea for Oil mechanism. Even if the military conflict comes to an end, Sri Lanka will find it difficult to continue to supply tea to Iran unless a new mechanism is introduced. Under the prevailing US sanctions on Iran, the exporters may not be able to supply tea to Iran outside the barter system. Iran purchases about 11 million kg of tea from Sri Lanka annually under the barter deal.
The situation was discussed with the Minister of Plantation & Community Infrastructure at a meeting held on March 4, 2026.
-
Features6 days agoBrilliant Navy officer no more
-
News2 days agoUniversity of Wolverhampton confirms Ranil was officially invited
-
Opinion6 days agoSri Lanka – world’s worst facilities for cricket fans
-
News3 days agoLegal experts decry move to demolish STC dining hall
-
Features6 days agoA life in colour and song: Rajika Gamage’s new bird guide captures Sri Lanka’s avian soul
-
News2 days agoFemale lawyer given 12 years RI for preparing forged deeds for Borella land
-
Business4 days agoCabinet nod for the removal of Cess tax imposed on imported good
-
News1 day agoWife raises alarm over Sallay’s detention under PTA
