Treasury losing billions due to Excise fraud: MP Pathirana

The Excise Department is causing over Rs. 100 billion in losses to the Government through fraud relating to alcohol sales, alleges Matera District SJB MP Buddhika Pathirana.

He said malpractices occur with relation to tax stamps affixed on alcohol bottles, and mass-scale production of artificial toddy that escapes the tax net. Pathirana added the corruption involves senior officials from both the Excise Department and the Treasury. The MP made these comments in parliament during the Government budget debate.

Pathirana charged that the QR code attached to tax stamps does not work, and this was done deliberately to enable some producers to escape the text net and alter production numbers. Meaningless spot fines are issued by excise officers to dupe the Finance Ministry into believing the Excise Officials are cracking down on malpractices, he added, and remarked that corrupt officials have no concern for directives issued by the minister. 

Despite numerous serious concerns raised on the company issuing tax stamps, Excise Officials continue to offer the contract to the same company, which has been blacklisted in many countries, Pathirana said.

Justice Minister Wijeyadasa Rajapakshe, supported MP Pathirana’s claims, who remarked that fraud from tax stamps alone cost the Government Rs. 60 billion annually. He too added that three countries had blacklisted Madras Security Printers, the company issuing the said tax stamps. Rajapakshe added he had filed legal action against the company and its operations in Sri Lanka, but had been unable to see it through. Minister Pathirana is pointing out its outcomes, he added. Rajapaksa said a further $ 40 billion was lost annually through falsification of production volumes.