Business

Vehicle permit revival threatens governance credibility – Advocata

Published

2 months ago

2026/02/14

Advocata warns revival of vehicle permits threatens governance credibility, public trust and economic reform and strongly cautions against government consideration to allow vehicle imports for high-ranking government officials who received permits upon retirement.

According to statements in Parliament, 1,900 permits have already been issued under this concessional scheme for senior officials, with 563 permits issued in 2025 alone. Meanwhile, ordinary citizens endure an extended vehicle import ban and some of the highest effective taxes on personal transport vehicles in the world.

During the presentation of the 2026 Budget Proposal, President Anura Kumara Dissanayake declared: “There will be no permits. The permit culture must end in Sri Lanka!”

Advocata welcomed this commitment, recognising permit culture as a relic of a feudal system, not a feature of a modern economy. It is a system that has, for decades, rewarded privilege over performance, entrenched inequality, and undermined the credibility of the state. The President’s affirmation offered renewed hope that Sri Lanka was finally moving toward transparent and equitable reform.

To now entertain exemptions for a select group sends a dangerous signal about reform credibility. Even policies publicly acknowledged as corrosive have the potential to quietly return.

The Normalisation of State Sanctioned Privilege

Vehicle permits are not compensation. They are discretionary privileges, operating as hidden transfers of public wealth to a privileged few, while the broader population absorbs higher taxes and reduced services. Worse still, they place retirement benefits at the mercy of political discretion, turning professional civil servants into political dependents rather than accountable public servants.

Therefore, it is precisely the high-ranking officials that must lead by example.

In December 2010, Transparency International Sri Lanka revealed that the majority of 65 newly elected Parliamentarians, including 2 Cabinet Ministers, sold their duty free vehicle permits for as much as Rs. 17 million each, when adjusted for inflation using Department of Census and Statistics figures, that windfall is equivalent to which adjusted for inflation sits at approximately Rs. 48 million today.

In December 2012, in an event the Sunday Times classified as a “Christmas Bonanza for MPs,” the Government granted permission for MPs to openly sell their duty free permits. At the time, they sold for Rs. 20 million each, which adjusted for inflation sits at approximately Rs. 50 million today.

In October 2016, Nagananda Kodituwakku, an attorney-at-law and rights activist, wrote to the Commissioner General of Motor Traffic, naming 75 MPs who imported luxury vehicles, including BMWs, Mercedes-Benz, Land Cruisers and even a Hummer. The total tax waived per MP ranged from Rs.30 million to Rs. 44.7 million. In today’s terms, this range approximately translates to between a staggering Rs. 66 million and Rs. 98.5 million.

History demonstrates the scale of abuse enabled by this system.

Toward integrity in Governance

As Advocata has previously highlighted, Sri Lanka’s cascading tax structure drives effective import duties on most passenger vehicles into the 125–250 percent range. Every duty-free permit therefore represents a direct fiscal loss; revenue that must be recovered through higher taxes elsewhere or reduced public services for everyone else. Since 2020 alone, more than 25,000 duty-free permits have been issued to government employees, including during the height of the economic crisis.

Making exceptions now would set a dangerous precedent. It signals to every remaining permit holder that persistence will be rewarded, inevitably triggering lobbying pressure and further demands for carveouts. This is how temporary “concessions” become permanent entitlements. Once reopened, the system cannot be credibly contained.

From an economic and governance perspective, reintroducing selective exemptions would undermine public confidence in fiscal consolidation, weaken the credibility of reform commitments, and damage investor perceptions of Sri Lankan regulatory stability and policy consistency.

The appropriate solution lies in transparent, on-budget salary structures, subject to Parliamentary oversight. Crucially, they must compensate public servants fairly without undermining fiscal discipline or institutional integrity, avoiding the distortions created by discretionary privilege schemes.

Advocata calls on the government to take the following actions:

Abandon plans to allow vehicle imports under existing duty free permits.

Commit to permanently ending vehicle permit schemes, replacing them with clear and transparent salary frameworks subject to Parliamentary oversight.

Legislate a prohibition on duty-free vehicle permits for public sector officials, safeguarding against future reversals and ensuring consistent policy application.

Sri Lanka cannot rebuild trust while preserving elite carve-outs. Reform commitments retain credibility only when they are applied consistently — without selective exemptions. Advocata spokespersons are available for live and pre-recorded broadcast interviews via 0755477522

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Business

SL’s economic outlook for 2026 being shaped by M-E conflict

Published

15 hours ago

2026/04/11

Thilina Walpola

The top table at the ADB media briefing

Sri Lanka’s economic growth is expected to moderate to 4.0% in 2026 and climb to 4.2% in 2027, following two consecutive years of strong 5.0% growth.

This forecast is based on an early stabilization scenario for the Middle East conflict, according to the Asian Development Outlook (ADO) April 2026, Asian Development Bank’s (ADB) flagship economic publication. Sri Lanka’s recovery held firm in 2025 despite the late-year disruption of Cyclone Ditwah. Private consumption surged amid low inflation and easing interest rates, while remittances hit a record high, as did the primary budget surplus. The current account posted a third consecutive surplus, and official reserves climbed to their strongest level in years.

The outlook for 2026 is increasingly shaped by the conflict in the Middle East, even as post-Ditwah reconstruction spending provides some support for growth. Private consumption will remain the main growth driver, though higher inflation will temper household spending power, and private investment is expected to recover only gradually amid heightened uncertainty.

Higher energy costs, potentially weaker remittance inflows, and disruptions to trade and tourism will weigh on household incomes and external buffers and drag on economic growth. Inflation is projected to accelerate sharply to 5.2% in 2026, driven largely by the Middle East conflict.

“Sri Lanka has come a long way since the recent economic crisis, and its economic performance over the last two years is a major achievement,” said ADB Country Director for Sri Lanka Shannon Cowlin. “However, the risks ahead are real and significant. This is not the moment to ease up on reforms. Fiscal discipline must be maintained and resilience must be strengthened against the external shocks that will keep testing this economy. At the same time, scaling up and executing public investment will be essential to sustaining the recovery.”

ADB is a leading multilateral development bank supporting sustainable, inclusive, and resilient growth across Asia and the Pacific. Working with its members and partners to solve complex challenges together, ADB harnesses innovative financial tools and strategic partnerships to transform lives, build quality infrastructure, and safeguard our planet. Founded in 1966, ADB is owned by 69 members—50 from the region.(ADB)

Business

Hameedia unveils “Threads of Culture”

Published

15 hours ago

2026/04/11

Thilina Walpola

This Avurudu season, Hameedia introduces its latest campaign, “Threads of Culture,” celebrating the traditions that connect generations while embracing a more conscious and forward-thinking approach to fashion.

Rooted in the spirit of Sinhala and Hindu New Year, the campaign highlights the importance of preserving culture while evolving with modern values. This year, Hameedia places a strong emphasis on ethical and sustainable fashion, encouraging customers to move away from fast and imitation fashion towards quality, authenticity, and responsible choices.

As part of this shift, Hameedia presents a refreshed festive collection crafted using lightweight cotton and linen fabrics, designed specifically for Sri Lanka’s climate. The collection focuses on breathability, comfort, and timeless style, offering customers clothing that is both practical and refined for the season.

Commenting on the campaign, Fouzul Hameed, Managing Director of Hameedia, stated, “Avurudu is a time of renewal, reflection, and meaningful connection. With ‘Threads of Culture,’ we wanted to go beyond celebration and inspire a shift in mindset, encouraging Sri Lankans to choose authenticity over imitation, quality over quantity, and responsibility over convenience. As a homegrown brand, we take pride in upholding craftsmanship and ethical practices, and we believe fashion should not only look good but also do good.”

Marking a key milestone in its expansion, Hameedia is also set to open its newest outlet in Galle, further strengthening its presence across the island and making its signature craftsmanship more accessible to customers in the southern region.

Business

Colombo Shopping Festival 2026 declared open for 5 days of Avurudu Shopping

Published

15 hours ago

2026/04/11

Thilina Walpola

The much-anticipated 41st Edition of the Colombo Shopping Festival (CSF) – Avurudu Fair was ceremonially declared open at the BMICH Exhibition Centre, marking the beginning of five exciting days of festive shopping in celebration of the Sinhala and Tamil New Year.

The ceremonial opening commenced with the traditional lighting of the oil lamp on 8th April 2026, in the presence of guests, industry leaders, and invitees. Organized by Aitken Spence Conventions and Exhibitions, the event continues to reinforce its position as one of Sri Lanka’s premier consumer exhibitions.

Running from 8th to 12th April 2026, from 10:00 a.m. to 10:00 p.m. daily, the Colombo Shopping Festival brings together over 200+ Micro, Small, and Medium Enterprises (MSMEs) from across the island, offering a vibrant marketplace that supports local businesses while delivering exceptional value to shoppers.

This year’s Avurudu Fair promises an unmatched retail experience, featuring a wide range of products including fashion, lifestyle, homeware, beauty, and more. Visitors can shop top brands such as Boss, EL Holdings, Vantage, Miniso, Governor Shirts, Edge Casual, Avirate, Cetaphil, Phoenix, Rite Shu and many more top brands, alongside a diverse selection of Indian stalls offering exclusive collections at massive discounts.

The festival creates the perfect opportunity for families and shoppers to prepare for the New Year with unbeatable deals, festive offers, and a lively atmosphere filled with seasonal excitement.

With its strong legacy and continued commitment to empowering local entrepreneurs, the Colombo Shopping Festival stands as a key highlight in Sri Lanka’s event calendar—bringing together commerce, culture, and celebration under one roof.