The Committee on Public Accounts (COPA) has announced its intention to launch an investigation into instances of under-invoicing of coal stocks imported for the Norochcholai thermal power plant, aimed at evading the rightful payment of Value Added Tax (VAT). COPA Chairman Lasantha Alagiyawanna informed the Daily Mirror that the committee carefully examined the audit reports from Sri Lanka Customs spanning the years 2019, 2020, and 2021, subsequently ordering a comprehensive inquiry into the matter.
According to Alagiyawanna, the under-invoicing of coal imports was identified as a deliberate strategy to circumvent VAT payments, and he highlighted the existence of numerous administrative shortcomings and irregularities in the process.
A statement from the parliamentary media unit revealed that an estimated Rs.187 million has been undercharged through this questionable practice. COPA emphasized the financial advantages gained by presenting falsified local information during the release of warehouses acquired by a private institution for a water development project in the Eastern Province.
The statement further detailed a concerning incident where the release of goods, warehoused by the private company at USD 5,139,621, involved the use of locally prepared forged documents. This manipulation allowed the company to obtain an excess payment of USD 1,210,743, despite the declared value being USD 6,350,364. COPA has recommended the submission of a detailed report on this matter within one month.
During the committee meeting, attention was also directed towards the implementation of new technology by Customs. Current practices involve the utilization of a system called “ASYCUDA,” which is linked to the Ramis system. Additionally, it was disclosed that a new technology system is anticipated for future implementation. The statement also highlighted discussions on measures taken for amending the Customs Ordinance Act, with officials indicating that proposed amendments will be presented to Parliament in January 2024.
