Rs. 2.42 Bn tax loss in electric vehicle permits for migrant workers : COPA
The Parliamentary Committee on Public Accounts (COPA) has disclosed that a significant misuse has occurred in issuing permits for the importation of fully electric vehicles to Sri Lankans employed abroad, based on foreign remittances.
This was disclosed during the COPA Committee meeting held recently (02 Apr) to discuss the special audit reports compiled regarding the scheme implemented between 01 May 2022 and 15 September 2023 to grant permits for the importation of fully electric vehicles for Sri Lankans employed abroad, based on foreign remittances.
During the meeting, the Auditor General pointed out that there are suspicions of money laundering in the issuance of these vehicle permits. He indicated that these suspicions emerged upon examining the entire procedure carried out in this regard.The Auditor General further revealed that 1,077 vehicle permits were issued during this period, of which 77 permits were later canceled, and that two main institutions had acted as importers providing facilities for 640 permit holders. He emphasized that this indicates the creation of a business under the pretext of permit issuance.
Moreover, due to the increase of the luxury tax exemption threshold from Rs. 6 million to Rs. 12 million for 921 vehicles imported until 30 September 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 traveled abroad during the relevant period were issued electric vehicle permits. Since the circular relevant to this scheme did not specify a minimum duration of overseas employment required to be eligible for an electric vehicle permit, individuals who had been abroad for short periods ranging from three days to three months, as well as those who had traveled abroad intermittently, had been granted permits. It was also revealed that the Ministry of Labour and Foreign Employment had acted under this scheme before its revision.
Accordingly, the Chairman of the COPA stated that the former Secretary of the Ministry had carried out all these irregular activities at the behest of the former Minister and that this appears to have been done to provide privileges to a selected group of individuals.
Furthermore, an official who was present at the meeting stated that, as a public servant, it had been difficult to act with integrity while being involved in this scheme, which is why the official had opted for a transfer.
Accordingly, the COPA Committee recommended that an internal investigation be conducted and a report be submitted within a month, and that disciplinary action be taken against the officials involved in these irregularities.
