Customs tax irregularities cost Govt Rs 3B -- COPA

CEYLON TODAY | Published: 2:00 AM Jul 22 2021
News Customs tax irregularities cost Govt Rs 3B -- COPA

A loss of three billion rupees has incurred due to tax irregularities in the import of Toyota Hilux Smart Cabs, the Committee on Public Accounts (COPA) revealed.

This revelation was contained in the first COPA report presented to the ninth Parliament, on 20 July, by COPA Chairman Prof. Tissa Vitharana. The said loss had occurred when the Toyota Hilux Smart Cabs were imported by the Customs, levying less customs duty intended for a single cab. Accordingly, a loss of three billion rupees had incurred at a rate of one million rupees for each of the 3,000 vehicles. 

The COPA in the report observed that a large sum of tax income is lost to the Government due to the tax irregularities that occurred in the importation of vehicles by the Customs and the registration of these vehicles with the Department of Motor Traffic. According to the report, vehicles imported by the Customs, for special purposes at a lower tax rate, are registered with the Department of Motor Traffic as dual-purpose vehicles. 

In addition, during the period of 2010-2019, 44 vans were imported as special purpose vehiclesat a lower tax rate and subsequently registered with the Department of Motor Traffic as dual-purpose vehicles for the purpose of transporting passengers and goods.

Due to this process, the Government has lost at least Rs1,300 million in taxes. The report further observes that the Government has lost Rs 56 million in taxes due to the Toyota Land Cruiser not being properly cleared by the Customs under the passenger transport category.

 It has been revealed that the Toyota Land Cruiser luxury vehicle, imported by fixing a public address system and charging only a duty of Rs.1.5 million, under the special purpose vehicle, had been cleared under the category transport of passengers, where a duty of approximately Rs56 million should have been charged. 

The COPA has also observed that in order to avert the irregularities occurring, in the importation of special purpose vehicles the vehicles cleared under Harmonised System Code (HS code) No 8705 by the Customs should be registered with the Department of Motor Traffic under a special number (PZA).

CEYLON TODAY | Published: 2:00 AM Jul 22 2021

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