Home » CID to take over investigation into fake fool proof liquor sticker

CID to take over investigation into fake fool proof liquor sticker

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The Criminal Investigation Department is set to take over the investigation into alleged malpractices in the introduction of fool proof liquor with QR code for all liquor products without addressing practical issues and mal practices in the implementation of this scheme.

State Minister of Finance Ranjith Siyambalapitiya is to lodge a complaint with the Criminal Investigations Department regarding alleged malpractices concerning liquor stickers on alcohol products.

Several bottles containing fake stickers were discovered from wine stores in Thambuththegama, Thalawa and Kahatagasdilliya. Previously it emerged that QR codes affixed to these stickers do not work and provide details on the product and tax paid.

Speaking in Parliament earlier this week, Justice Minister Wijeyadasa Rajapakshe said the tender to supply tax stamps had been awarded to one of the most corrupt companies in the world, which has been blacklisted in many countries.

The company has been found guilty of distributing tax stamps to companies for payment, leading to millions in losses to State coffers.

The State Minister of Finance received a report on the matter from the Excise Director General recently and the Ministry has decided to refer the matter to the CID.

The Ministry has also assigned a service provider to verify reports on malfunction of QR codes, whilst a separate unit was formed at the Excise Department to investigate tax collections in relation to stickers issued.

The Sri Lankan Excise Department launched a special app recently titled ‘Excise Tax Stamp Validatot’, whereby consumers could verify the authenticity of tax stamps and report any discrepancies to the department.

The government has introduced the fool proof sticker scheme for all imported and local liquor products amidst industry protests and mounting allegations against the sticker printing deal.

The department will take action to cancel the licenses of liquor traders who fail to comply with the relevant regulations of the fool proof sticker scheme under the Excise Notification No. 01/2021, he added.

The previous regime has continued the contract given to Indian company Madras Security Printers Pvt Ltd by a tender initially called in 2016 and recalled in 2017 due to technical issues.

According to the 5-year contract, the Indian company has to supply 384 million stickers per year and 32 million per month, but its supply has been irregular and their printing paper quality was low and it could easily be duplicated by anyone, a senior Treasury official said.

Several local liquor manufacturers noted that the quality of the samples of fool proof liquor stickers was not suitable for use in their high-speed machines.

They have protested over the selection of this printer with allegations of its involvement in two scandals in India and Kenya in 2017 and 2018 and the impracticality of the fool proof liquor scheme.

The Indian company’s bid for the deal was US$5.99 to print 1000 stickers during the second tender although its initial bid was $3.19; other bidders claimed adding that one of them has placed a bid of $4.57 per 1000 stickers and the lowest bid was $2.8 per 1000.

Therefore the then government has been compelled to pay an additional amount of $1075200 (or slightly over $1 million) for 384 million stickers obtained in the first year, the Auditor General’s relevant report revealed.

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