Excise Dept increased revenue by Rs. 1 bn after checking fake stickers on liquor bottles

By: Staff Writer

Colombo (LNW): 103 year old Sri Lanka Excise Department will be modernised to enhance revenue collection by installing digital information system while improving efficiency of employees curtailing irregularities and tax evasion by large scale liquor manufacturers,

The monthly income of the Excise Department has increased by Rs. 1 billion after checking fake stickers on liquor bottles, a Parliamentary committee revealed.

This was revealed by the officials of the Excise Department to the Sectoral Oversight Committee on National Economic and Physical Plans.

The Excise Department, Inland Revenue Department and Sri Lanka Customs were summoned before the committee to discuss the matters mentioned in the report given to the President by the Sectoral Oversight Committee on National Economic and Physical Plans.

The committee inquired about the amendment of the Excise Ordinance Act. The committee also pointed out the need to maintain the revenue that the Excise Department has increased so far and the continuation of random raids will further reduce the fixing of fake stickers on liquor bottles.

The officials present before the committee mentioned that the RAMIS system will be made functional by January 2024 by avoiding the existing deficiencies.

The Inland Revenue Department said that the number of tax files is currently around 7 lakhs and it is expected to increase up to 10 lakhs in the future.

Apart from this, the committee also advised the officials to focus on preparing a system for evaluating the parties who pay income tax correctly.

The department has functioned without a computer-based Information System and details of the productions in several liquor manufacturing plants cannot be traced due to manual back office record system, parliamentary sectoral committee committee report revealed recently.

This has led to the tax evasion of. up to Rs.6.2 billion by nine leading liquor manufacturing companies making impossible for the department to collect the 2023 revenue target of Rs 207 billion , official data shows.

The Excise Department has collected Rs. 99 billion during the first eight months of this year, less than 47 per cent of the estimated revenue of Rs. 217 billion.

Finance ministry will take necessary action to devise necessary amendments to the Excise Ordinance with provisions to cancel the licenses of the manufacturers who evade paying taxes.

Measures will be taken to cancel the liquor license of the liquor shops selling alcohol without the sticker.

The department has been directed to collect data and check the quantity of liquor supplied to the liquor factories and the quantity of bottles distributed from the factories preventing any irregularities and malpractices.

It has been observed several manufacturers including a leading liquor company DCSL which has 50 percent market share of the total liquor consumption has not adhered to the directive of pasting stickers on liquor bottles.

The department has already ordered the company to paste stickers on all liquor bottles manufactured by them.