Is Sri Lanka Investigating John Keells for Rs 3 Billion Tax Fraud in BYD EV Imports?
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Synopsis
A bombshell investigation has erupted in Sri Lanka's electric vehicle sector, targeting John Keells Holdings over a staggering Rs 3 billion tax fraud linked to BYD EV imports. As the case unfolds, it raises crucial questions for buyers and the industry.
Key Takeaways
- John Keells Holdings faces serious allegations of tax fraud.
- The case involves over 1,000 BYD Atto 3 electric SUVs.
- Disputes over motor capacity could lead to billions in unpaid taxes.
- Customers may face retroactive tax bills or recalls.
- The investigation is ongoing, with potential legal consequences.
New Delhi, July 29 (NationPress) A significant controversy has emerged in Sri Lanka's electric vehicle industry as John Keells Holdings PLC (JKH), one of the nation's leading blue-chip firms, faces an investigation regarding an alleged Rs 3 billion tax fraud. Reports indicate that this case pertains to the importation of over 1,000 BYD Atto 3 electric SUVs through its subsidiary, JKCG Auto.
Sri Lanka Customs has verified that a shipment of these vehicles was held at the Port of Colombo due to discrepancies concerning their declared motor capacity, which influences the import duty applicable, as reported by Lanka News.
Import documents allegedly listed the vehicles as having 100kW motors, which would categorize them into a lower tax bracket of approximately Rs 2.4 million per unit.
However, inspections and independent technical evaluations have raised alarms that the vehicles could actually possess 150kW motors—a classification that would incur an import duty of nearly Rs 5.4 million each.
This difference in classification could lead to billions of rupees in owed taxes.
Reports also suggest that nearly all the affected vehicles have been sold and registered to private buyers.
Some customers have reportedly been alerted that they might be faced with retroactive tax liabilities or even vehicle recalls if the investigation substantiates the higher motor capacity.
John Keells Holdings has refuted any allegations of misconduct, asserting that the vehicles were imported in complete accordance with manufacturer specifications and that the Sri Lankan variant is calibrated to 100kW, akin to models sold in Nepal and Singapore, according to the report.
The Customs Directorate of Revenue Protection has commenced a forensic investigation into every BYD Atto 3 imported since 2023, including those already sold to consumers.
Experts caution that if over 1,000 vehicles are reclassified as 150kW models, purchasers could confront additional tax obligations of up to Rs. 4 million each—potentially sparking a series of legal challenges.
Point of View
I believe it's essential to approach this sensitive issue with integrity and thoroughness. The inquiry into John Keells Holdings not only reflects on corporate governance but also highlights the need for transparency in our burgeoning electric vehicle market. We stand firm in our commitment to providing accurate reporting on this evolving situation.
NationPress
31/07/2025
Frequently Asked Questions
What is the basis of the investigation into John Keells?
The investigation revolves around allegations of tax fraud linked to the import of BYD Atto 3 electric SUVs, specifically concerning the declared motor capacity of the vehicles.
What are the potential tax implications for buyers?
If the vehicles are reclassified with a higher motor capacity, buyers may face additional tax bills of up to Rs. 4 million each.
How has John Keells responded to the allegations?
John Keells Holdings has denied any wrongdoing, asserting compliance with manufacturer documentation and asserting that the Sri Lankan variants conform to the 100kW specification.
What actions have Sri Lanka Customs taken?
Sri Lanka Customs has detained a shipment of the vehicles and initiated a forensic investigation into all BYD Atto 3 imports since 2023.
What is the significance of the motor capacity classification?
The motor capacity classification significantly affects the import duties charged, with discrepancies leading to potential billions in unpaid taxes.
