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Audit report: Customs denies ‘undue benefits’, revenue loss

Audit report: Customs denies ‘undue benefits’, revenue loss

22 May 2024 | BY Sahan Tennekoon


  • Claims findings are correct but misinterpreted


The Customs stated that none of its existing practices, enshrined in the relevant legislation, have affected the country’s Customs revenue adversely as has been misinterpreted by certain parties, based on a recent report published by the National Audit Office.

Recently, it was reported that the Government incurs a loss of billions of rupees as Customs officers enjoy undue benefits in penalties related to Customs offences and overtime pay, as per a special audit carried out by the Auditor General regarding the management and administration of various funds in the Customs. It was claimed that only 30% of the revenue collected from import related penalties is directly credited to the Consolidated Fund.

In this context, when queried by The Daily Morning yesterday (21), Customs Spokesperson Seevali Arukgoda stated that the matters mentioned in the audit report are correct but had been mostly misinterpreted by certain parties, including the media. He also said that the report was made without having a clear knowledge of the structure and nature of the Customs as an institution. He also noted that the Customs and its officers do not enjoy any ‘unfair' benefit, but what is entitled to them by the relevant piece of legislation, stating that 30% of all the revenue collected through Customs offences and forfeitures would directly go to the Government's Consolidated Fund as it is the amount allocated for the particular purpose as per Section 153 of the Customs Ordinance, No. 17 of 1869.


“If someone says that the Customs officers enjoy unfair benefits, they have to change the existing legislation, as we are working according to the Act,” he said.

The report reportedly claims that an internal Departmental order had been prepared at its own discretion, even though the Finance Minister’s approval is needed to distribute the reward money among officers and informants as per Section 153(2)(b) of the Customs Ordinance. In response to this, Arukgoda said that Customs does not have such discretion. He also said that the Customs has collected Rs. 970 billion in revenue while collecting Rs. 6 billion in penalties.

Speaking further about not implementing a system of fingerprints, Arukgoda stressed that implementing such a system in a Department like the Customs would not be practical since the nature of the duties of Customs officers is largely different from those of other public servants. He also said that the implementation of such a system would cause many issues within the system.

State Minister of Finance Ranjith Siyambalapitiya and the Secretary to the Ministry of Finance, Economic Stabilisation, and National Policies Mahinda Siriwardana were unavailable for comment.



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