by Our Correspondent in Colombo
Allegations have emerged in Sri Lanka that a major company linked to a politically connected businessman may have secured a significant financial advantage by acting ahead of a newly imposed government surcharge on vehicle imports. According to reports, the company arranged approximately $20 million in letters of credit through banks prior to the introduction of a 50 percent surcharge designed to discourage vehicle imports.
The timing of the transactions has raised concerns among officials and financial sector insiders, who claim the arrangement may allow the company to clear an entire shipment of imported vehicles without being subject to the increased tax burden. If confirmed, the development could result in an estimated loss of around 3.5 billion Sri Lankan rupees in state revenue, a figure that would instead translate into substantial additional profit for the importing firm.
Sources familiar with banking operations have suggested that the sequence of events indicates prior knowledge of the impending tax change. They allege that information regarding the policy adjustment may have been communicated in advance, enabling the company to structure its imports in a way that avoided the higher surcharge. These claims, however, have not been independently verified by authorities.
The businessman at the centre of the allegations is widely described in local media as having close ties to influential figures within the government. He is also reported to have business interests connected to the casino and gaming industry, a sector often associated with high-value cash flows and regulatory scrutiny in Sri Lanka.
