Questions mount over excise tax collections and licences

JVP Central Committee Member Wasantha Samarasinghe alleges that the Government is preparing to issue two licences for the manufacture of hard alcoholic products. Addressing a media briefing, Samarasinghe charged that a company already licensed to import and bottle spirits will receive one such new license.

The allegations were also brought up in Parliament recently by SJB MP, Buddhika Pathirana, who revealed that licences were to be issued under the pretext of producing local wines, which have a lower tax threshold of just Rs. 900 per litre. Taxes on spirits amount up to Rs. 3,200 per litre, and this could result in significant losses to the Government, Pathirana charged. 

Excise licences are issued by the Ministry of Finance, and the State Minister of Money stated in Parliament he would look into these allegations. Earlier this month the Excise Department stated that new licences could only be issued with the permission of the Finance Ministry. 

The Parliamentary Committee on Public Accounts found last week that alcohol producers have failed to pay over Rs. 23 billion in taxes to the Government, with late fees alone mounting to a further Rs. 19 billion. Its Chairman, Prof. Tissa Vitharana, instructed the Excise Department to take necessary action to expedite receiving these funds from the said manufacturers.