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SJB unionist: IOC and Sinopec benefit from special levy on fuel to recover CPC losses

Published

2 years ago

2024/01/2

Sahan Weerasooriya

Ananda Palitha

By Shamindra Ferdinando

Even after imposing 18 percent Value Added Tax (VAT) on fuel with effect from January 1, the government continued to charge Rs 50 on a litre of both petrol and diesel purportedly to recover losses incurred by the highly corrupt state owned Ceylon Petroleum Corporation (CPC) over the years, Samagi Jana Balawegaya trade union leader Ananda Palitha told The Island yesterday (01).

The CPC owed the public an explanation why those who had been struggling to make ends meet were forced to pay for losses caused by waste, corruption, irregularities and mismanagement at all levels at the government managed entity, the former UNP activist said.

According to Ananda Palitha, the government introduced Rs 50 charge on each litre of petrol or diesel sold with effect from June 01, 2023 due to accumulated government-guaranteed debt of nearly USD 3 bn owed by the CPC to the Bank of Ceylon and People’s Bank transferred to the Treasury in line with a Cabinet decision.

Palitha pointed out that two private enterprises, namely Lanka Indian Oil Company (LIOC) and Chinese giant Sinopec, had been the main beneficiaries of the controversial levy.

The trade unionist took up this issue in the wake of the new pricing formula announced at midnight on January 1.

The CPC and LIOC increased the price of a litre of petrol 92 by Rs 20 to Rs 366 whereas Sinopec priced the litre at Rs 363. The CPC and LIOC increased the price of litre of auto diesel by Rs 29 to Rs 358 while Sinopec priced the litre at Rs 355. The CPC, LIOC and Sinopec priced petrol 95 and super diesel at Rs 464 and Rs 475, respectively, having increased the price of litre by Rs 38 and Rs 41. A litre of kerosene has been reduced by Rs 11 to be priced at Rs 236.

Contrary to various reports regarding the new pricing formula, the government imposed 18 percent VAT after having abolished 7.5 percent Port and Airport Development Levy aka PAL but retained the unprecedented Rs 50 charge on a litre of diesel and petrol.

Ananda Palitha alleged that the Cabinet approved original plan to levy 1% tax on monthly sales of new entrants to the domestic fuel market, namely Chinese oil giant Sinopec, US-based R.M. Parks and United Petroleum of Australia was reversed and a special charge of Rs. 50 imposed on hapless consumers. The US and Australia-based firms are yet to launch operations here.

One percent tax was to be utilized to settle USD 3 billion loans taken by the CPC but following representations made by Sinopec, the government abolished 1% tax on their sales, Ananda Palitha said, urging the Opposition to examine the issue at hand without further delay.

Responding to another query, the political activist found fault with the Parliament for not looking into the pricing formula, regardless of the media relentlessly taking up the issue. The Opposition, too, had been largely silent while the government allowed Indian and Chinese state companies to make a killing, the SJB trade union leader alleged. “We are contemplating lodging a complaint with the Commission to Investigate Allegations of Bribery or Corruption. Can a bankrupt country allow foreign companies to make such huge profits at the expense of the public?” Ananda Palitha asked.

The government repeatedly assured that the entry of foreign players would stabilize the local market and ensure uninterrupted supply, Ananda Palitha said. “We were told of competitive pricing formulas and quality products at affordable prices. But, the foreign players are now making unconscionable profits with the blessings of the government,” the activist said.

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Tri-Forces donate LKR. 372 million, a day’s pay of all ranks to ‘Rebuilding Sri Lanka’ Fund

Published

5 hours ago

2026/01/3

Priyan

Members of all ranks from the Sri Lanka Army, Sri Lanka Navy and Sri Lanka Air Force have collectively donated a day’s basic salary to the ‘Rebuilding Sri Lanka’ Fund, which was established to restore livelihoods and rebuild the country following the devastation caused by Cyclone Ditwah.

Accordingly, the total contribution made by the Tri-Forces amounts to LKR. 372,776,918.28.

The cheques representing the financial contributions were handed over on Wednesday (31 December) at the Presidential Secretariat to the Secretary to the President, Dr. Nandika Sanath Kumanayake.

The donations comprised LKR. 250 million from the Commander of the Army, Major General Lasantha Rodrigo; LKR. 73,963,879.71 from the Commander of the Navy, Rear Admiral Kanchana Banagoda and LKR. 48,813,038.97 from the Commander of the Air Force, Air Marshal Vasu Bandu Edirisinghe.

Secretary to the Ministry of Defence, Air Vice Marshal Sampath Thuyacontha, was also present on the occasion.

News

CEB demands 11.57 percent power tariff hike in first quarter

Published

7 hours ago

2026/01/3

Thilina Walpola

The Ceylon Electricity Board (CEB) has submitted a proposal to the Public Utilities Commission of Sri Lanka (PUCSL) seeking an 11.57 percent increase in electricity tariffs for the first quarter of 2026, citing an estimated revenue shortfall and additional financial pressures, including cyclone-related damages.

According to documents issued by the PUCSL, the proposed tariff revision would apply to electricity consumption from January to March 2026 and includes changes to both energy charges and fixed monthly charges across all consumer categories, including domestic, religious, industrial, commercial and other users.

Under the proposal, domestic electricity consumers would face increases in unit rates as well as fixed monthly charges across all consumption blocks.

The CEB has estimated a deficit of Rs. 13,094 million for the first quarter of 2026, which it says necessitates the proposed 11.57 per cent tariff hike. The utility has noted that any deviation from this estimate whether a surplus or a shortfall will be adjusted through the Bulk Supply Tariff Adjustment (BSTA) mechanism and taken into account in the next tariff revision.

In its submission, the CEB said the proposed revision is aimed at ensuring the financial and operational stability of the power sector and mitigating potential risks to the reliability of electricity supply. The board-approved tariff structure for the first quarter of 2026 has been submitted to the PUCSL for approval and subsequent implementation, as outlined in Annex II of the proposal.

The CEB has also highlighted the financial impact of Cyclone Ditwah, which it said caused extensive damage to electricity infrastructure, with total losses estimated at around Rs. 20 billion. Of this amount, Rs. 7,016.52 million has been attributed to the first quarter of 2026, which the utility said has a direct bearing on electricity tariffs.

The CEB warned that if external funding is not secured to cover the cyclone-related expenditure, the costs incurred would need to be recovered through electricity tariffs in the second-quarter revision of 2026.

Meanwhile, the PUCSL has said that a decision on whether to approve the proposed tariff increase will be made only after following due regulatory procedures and holding discussions on the matter.

By Sujeewa Thathsara ✍️

News

Health Minister sends letter of demand for one billion rupees in damages

Published

7 hours ago

2026/01/3

Thilina Walpola

Ondansetron controversy

Minister of Health and Mass Media Dr Nalinda Jayatissa has sent a letter of demand for Rs. 1 billion in damages from YouTube content creator Dharmasri Kariyawasam, accusing him of disseminating false and defamatory material linking the Minister to the importation of Ondansetron and inciting public unrest.

The notice, sent through the Minister’s lawyers, states that investigations are currently under way into 10 medicines, including Ondansetron Injection, manufactured by India-based Maan Pharmaceutical Limited.

Ondansetron Injection was among nine injectable drugs recently suspended by the National Medicines Regulatory Authority (NMRA) following reports of patients administered with the drug suffering adverse complications.

Despite the ongoing investigations, Kariyawasam allegedly aired a widely viewed programme on his YouTube channel titled “The hidden story of the Indian drug that claimed lives, Mayor Balthazaar’s relative, and Minister Nalinda’s cover-up.”

According to the letter of demand, the programme falsely portrayed Minister Jayatissa as being directly responsible for importing the drug, colluding with the supplier, and attempting to conceal the issue, while depicting him as indifferent to public suffering.

The Minister’s lawyers maintain that these allegations are entirely false and defamatory, citing passages in which Kariyawasam allegedly accused Jayatissa of lying about the supplier, concealing facts related to PTC Medicals (Pvt) Ltd., the actual importer, and showing a lack of concern over deaths purportedly linked to the drug.

The programme also claimed links between the directors of PTC Medicals and family members of Colombo Mayor Vraîe Cally Balthazaar, implying political favouritism.