News
COPA baffled by massive rewards for Customs at the expense of Treasury
Question mark over Tax Appeals Commission
70% of fine on Lanka Coal ends up with officers
By Shamindra Ferdinando
The cash-strapped government hasn’t been able to recover tax revenue running into billions of rupees, in spite of sporadic interventions made by the Parliamentary Watchdog, the Committee on Public Accounts (COPA).
According to a report submitted to Parliament on July 20 by COPA, the situation has been further complicated by the Customs receiving substantial amounts, as rewards, from fines imposed on tax defaulters, at the expense of the Treasury.
Prof. Tissa Vitarana, in his capacity as the Chairperson of the 22-member COPA, has submitted the report.
The COPA has questioned the Customs why prominent palm oil importers Pyramid Wilma Pvt Ltd and Naratha Agro Industries (Pvt) Ltd. were allowed to appeal in 2019 against the Attorney General’s decision that loss of revenue suffered by the Treasury to the tune of Rs 6.130 bn during 2013-2016 period should be charged from 2013 instead of 2016 as recommended by a committee that inquired into the irregularities.
Pointing out that the Tax Appeals Commission couldn’t accept appeals made after the stipulated 3 month period following a particular decision, COPA has instructed Director General of Customs, Maj. Gen (retd) Vijitha Ravipriya to inform the Tax Appeal Commission. DG, Customs has done so on Feb 2, 2021, COPA according a copy of the report made available to The Island.
Tax Appeals Commission has been established in terms of Tax Appeals Commission Act No 23 of 2011 (subsequently amended).
COPA has also dealt with an unprecedented case of Sri Lanka Ports Authority (SLPA) and Customs being involved in a costly case wherein the latter was seeking 50 percent of a fine imposed on SLPA as a reward for those involved in the inquiry. According to COPA proceedings, the SLPA had been blamed for defaulting on the payment of Rs 916,526 over the import of gantry cranes and other equipment worth Rs 11,498,829,084 way back in 2011.
In spite of talks involving stakeholders, including the Treasury as well as the House watchdog over the years, the issue hadn’t been resolved as both parties spent quiet a lot on lawyers.
Customs have sought a staggering 50 percent as a reward for officers from the fine imposed on the SLPA. The Consultative Committee on ports and shipping has inquired into the possibility of the Treasury taking the entire sum.
COPA has questioned the rationale in one government institution receiving cash reward at the expense of another as it caused quite a problem. According to the COPA report made available to The Island, the watchdog has requested Chief Accounting Officer/Accounting Officer to send all relevant reports and documents to parliament before the Customs appeared before Prof. Vitharana’s outfit in two months.
Prof. Tissa Vitharana told The Island that remedial measures should be taken to improve the revenue collection process. Appreciating the services rendered by members of his committee, the political veteran said that the need to enhance state revenue couldn’t be ignored. The LSSPer noted that the government income had now fallen very much less than 10 percent of the GDP, a situation all should be seriously concerned about.
COPA has examined the legal wrangle involving the Customs and the SLPA against the backdrop of Customs officers receiving half of Rs 205 mn imposed on Lanka Coal Company (Pvt) Ltd as rewards due to the payment being categorized as a fine instead of an additional tax. The company in question has been formed by CEB (60%), Treasury (20%), Ceylon Shipping Corporation (10%) and SLPA (10%). COPA pointed out that in addition to taking 50 % of the so called fine, Customs had secured a further 20% (Rs 41 mn) for their welfare and management fund leaving Rs 61.5 for the Treasury.
COPA has underscored the need to amend relevant laws to prevent recurrence of such irregularities.
COPA has revealed a spate of instances wherein due to range of factors, including raging Covid-19 epidemic had been blamed on the inordinate delay in settling a substantial number of tax appeals. The tax and penalties pertaining to 1,108 appeals amounted to a staggering Rs 18,684,603,316 whereas only 49 were finalized.
News
NMRA laboratory lacks SLAB accreditation
Drug controversy:
“Setting up state-of-the-art drug testing facility will cost Rs 5 billion”
Activists call for legal action against politicians, bureaucrats
Serious questions have been raised over Sri Lanka’s drug regulatory system following revelations that the National Medicines Regulatory Authority’s (NMRA) quality control laboratory is not accredited by the Sri Lanka Accreditation Board (SLAB), casting doubt on both the reliability of local test results and the adequacy of oversight of imported medicines.
Medical and civil rights groups warn that the issue points to a systemic regulatory failure rather than an isolated lapse, with potential political and financial consequences for the State.
Chairman of the Federation of Medical and Civil Rights Professional Associations, Specialist Dr. Chamal Sanjeewa, said the controversy surrounding the Ondansetron injection, which was later found to be contaminated, had exposed deep weaknesses in drug regulation and quality assurance.
Dr. Sanjeewa said that the manufacturer had confirmed that the drug had been imported into Sri Lanka on four occasions this year, despite later being temporarily withdrawn from use. The drug was manufactured in India in November 2024 and in May and August 2025, and imported to Sri Lanka in February, July and September. On each occasion, 67,600 phials were procured.
Dr. Sanjeewa said the company had informed the NMRA that the drug was tested in Indian laboratories, prior to shipment, and passed all required quality checks. The manufacturer reportedly tested the injections against 10 parameters, including basic quality standards,
pH value, visual appearance, component composition, quantity per phial, sterility levels, presence of other substances, bacterial toxin levels and spectral variations.
According to documents submitted to the NMRA, no bacterial toxins were detected in the original samples, and the reported toxin levels were within European safety limits of less than 9.9 international units per milligram.
Dr. Sanjeewa said the credibility of local regulatory oversight had come under scrutiny, noting that the NMRA’s quality control laboratory was not SLAB-accredited. He said establishing a fully equipped, internationally accredited laboratory would cost nearly Rs. 5 billion.
He warned that the failure to invest in such a facility could have grave consequences, including continued loss of life due to substandard medicines and the inability of the State to recover large sums of public funds paid to pharmaceutical companies for defective drugs.
“If urgent steps are not taken, public money will continue to be lost and accountability will remain elusive,” Dr. Sanjeewa said.
He added that if it was ultimately confirmed that the drug did not contain bacterial toxins at the time it entered Sri Lanka, the fallout would be even more damaging, severely undermining the credibility of the country’s health system and exposing weaknesses in health administration.
Dr. Sanjeewa said public trust in the health sector had already been eroded and called for legal action against all politicians and public officials responsible for regulatory failures linked to the incident.
by Chaminda Silva ✍️
News
Air quality deteriorating in Sri Lanka
Air quality in Sri Lanka has deteriorated in recent days, with Air Quality Index (AQI) levels rising, particularly in the Northern, North Central, North Western and Western Provinces, the Central Environmental Authority (CEA) said.
CEA Media Spokesman Dr. Ajith Gunawardena said a noticeable decline in air quality had been recorded, with AQI values ranging between 150 and 200.
Attributing the situation to transboundary air movement, combined with the activation of the Northeast Monsoon, Dr. Gunawardena noted that similar conditions had been observed during the same period in previous years.
The CEA is continuing to closely monitor air quality and atmospheric conditions across the country, he said.
Dr. Gunawardena warned that individuals sensitive to poor air quality might experience adverse health effects and advised them to seek medical attention if necessary.He added that the situation was expected to ease after yesterday.
By Pradeep Prasanna Samarakoon ✍️
News
Cardinal urges govt. not to weaken key socio-cultural institutions
Educational Reforms:
Archbishop of Colombo His Eminence Malcolm Cardinal Ranjith on Saturday accused the government of pursuing education reforms undermining parental rights and Sri Lanka’s cultural and religious values.
Speaking at a ceremony at St. Joseph’s Church, in Hanwella, the Cardinal said several programmes, currently being implemented, were weakening key socio-cultural institutions such as marriage and family. He took exception to the government’s decision to introduce sex education to the school curriculum.
Cardinal Ranjith said Sri Lanka’s civilisation had been shaped over generations by religious traditions, including Buddhism, Hinduism, Islam and Christianity, particularly in relation to marriage, child-rearing and sexuality. He warned against abandoning these values in favour of, what he described as, foreign influences tied to external funding.
“No government has the right to interfere with the nation’s cultural heritage,” he said, urging political leaders to act within their mandate.
The Archbishop further alleged that ideas promoted alongside funding from United Nations agencies and other international bodies were eroding cultural and religious foundations, contributing to family breakdown and weakening respect between parents and children.
While affirming that children have human rights, he stressed that such rights should not be interpreted in a way that turned children against their parents. “What should exist between parents and children is a foundation of love,” he said.
by Norman Palihawadane ✍️
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