Three out of four crude coconut oil importers have defaulted on taxes, says Deputy Minister

By The Pulseline News Desk

Only one out of four companies importing crude coconut oil into Sri Lanka is paying the taxes due, while the remaining three have defaulted on their tax obligations, Deputy Minister Nishantha Jayaweera told Parliament today (6).

Responding to a question raised by Samagi Jana Balawegaya (SJB) MP S.M. Marikkar, the Deputy Minister revealed that the Government has encountered significant delays in recovering the unpaid taxes, primarily because the defaulting companies have lodged appeals.

“The tax recovery process has been delayed due to appeals filed by the companies concerned,” Jayaweera said, indicating that legal proceedings have slowed efforts to collect the outstanding revenue.

The disclosure has once again drawn attention to weaknesses in tax enforcement and the lengthy legal processes that often delay the recovery of public funds. While appeals are a legal right available to taxpayers, such proceedings can postpone the collection of substantial amounts owed to the State for years.

The issue is particularly significant given the importance of crude coconut oil imports to Sri Lanka’s food manufacturing sector and the Government’s ongoing efforts to strengthen revenue collection amid broader fiscal reforms.

The revelation also comes as tax compliance and enforcement remain key priorities for the Government, which has pledged to improve revenue administration and curb tax evasion as part of wider economic reforms aimed at strengthening public finances.

Although the Deputy Minister did not disclose the names of the companies involved or the total value of the outstanding taxes, the admission that only one importer is fully complying with its tax obligations is likely to raise questions about the effectiveness of enforcement mechanisms and the speed at which tax disputes are resolved.

With the Government under continued pressure to maximise State revenue, the progress of these appeals and the eventual recovery of the unpaid taxes are expected to come under closer parliamentary scrutiny.