The detention of a consignment of electric vehicles from Chinese automaker BYD at the Hambantota Port risks triggering a diplomatic dispute between Sri Lanka and China, Chairman of the Committee on Public Finance (COPF) Dr. Harsha de Silva said.
The COPF chair urged authorities to act swiftly and transparently to resolve the matter before it escalates into a bilateral issue.
Recalling a similar episode during Sri Lanka’s fertilizer crisis when a Chinese shipment became entangled in controversy following contradictory laboratory reports from Singapore and local authorities, De Silva called for a balanced approach to manage the current situation to protect both regulatory integrity and international relations.
Sri Lanka Customs has detained around 1,000 Chinese-made BYD electric vehicles at the port over questions surrounding their declared motor capacity, which directly impacts the applicable excise duty.
While documentation claims the vehicles are equipped with 100kW motors—attracting an excise duty of Rs. 2.4 million—concerns have been raised that they may in fact be fitted with 150kW motors, which would nearly double the tax liability to Rs. 5.4 million.
The vehicles, which remain under customs hold, are reportedly awaiting clearance over regulatory concerns. Dr. de Silva stressed that any inspections or evaluations should be conducted in line with international standards to ensure credibility and avoid unnecessary tensions.
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