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Unilever files writ against Customs

31 Oct 2021

  • Local media reports publish tax fraud of over Rs. 570 m
  • Unilever categorically denies tax evasion allegations
  • Says it adheres to all rules and regulations
    By Yakuta Dawood Unilever Sri Lanka has initiated legal proceedings by writ in the Court of Appeal against Sri Lanka Customs with regard to the ongoing dispute that was caused due to allegations levelled by Customs on the subject of fraudulent tax evasion by the company, The Sunday Morning Business learns. Responding to an email query sent by us, Unilever Sri Lanka affirmed the recent articles published on local media were “completely false and baseless allegations” against Unilever Sri Lanka, as they have conducted business operations in Sri Lanka by adhering to all the rules and regulations. “We would like to firmly state that Unilever Sri Lanka has always conducted its business in a lawful, fair, and ethical manner over the last 83 years of its presence in Sri Lanka and is committed to complying with all applicable laws, regulations, and standards in the country,” Unilever Sri Lanka stated. Furthermore, when inquired whether they were aware of the recent statement released by Customs (which was published by local media) alleging the company committed a tax fraud of over Rs. 570 million in importing raw materials for its products, Unilever Sri Lanka stated: “We regret to inform you that we are not aware of a statement released by the Sri Lanka Customs on an evasive policy of levying excise duty of Rs. 570 million. “However, Unilever Sri Lanka has initiated proceedings by writ in the Court of Appeal against the Sri Lanka Customs, in relation to an ongoing dispute. Since the matter is sub judice, we have been advised not to comment on these proceedings,” a spokesman from Unilever Sri Lanka told us. The company did not proceed to divulge more information on the subject. Meanwhile, when inquired about this matter, Sri Lanka Customs stated: “The case you are referring to is an ongoing investigation. Hence, we are not at liberty to disclose any related information.” According to media reports, Unilever Sri Lanka allegedly paid only 25% of the tax due to Sri Lanka Customs on the importation of palm oil fatty acids used in soap production, with tax evasion allegedly amounting to over Rs. 570 million from the period of October 2018 to April 2019. Additionally, it was also reported that the Customs authorities had filed a lawsuit against Unilever, No. 19/2021, in the Court of Appeal on 21 January 2021. Unilever Sri Lanka, one of the largest fast-moving consumer goods (FMCG) companies in the country, recently emerged as the No. 1 Most Respected FMCG company in LMD’s Most Respected Entities List in Sri Lanka for 2021, with an overall rank of 10th from over 100 companies across varying industries. This was the 16th consecutive year Unilever was rated the No. 1 FMCG corporation in Sri Lanka by LMD. The company was also declared the Sector Winner in both the “Multinational” and “Consumer Products” categories, affirming its strength as a global giant with deep local roots. Furthermore, Unilever Sri Lanka also emerged as the highest-rated FMCG company in five of the 12 attributes surveyed for this year’s ranking including “Innovation”, “Corporate Culture”, “CSR and Sustainability”, “Dynamism”, and “HR and People Management”.


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