The opposition Samagi Jana Balawegaya has accused Sri Lanka Customs of running an organised extortion racket against importers, warning that sustained harassment by officials is pushing micro, small and medium enterprises out of the import trade and putting jobs and tax revenue at risk.

Speaking in Parliament last week, SJB MP Mujibur Rahman said imports had fallen steadily in recent months as importers — particularly MSMEs — faced what he called “draconian” treatment, and questioned why the government had stayed silent on a longstanding problem, the Daily FT reported.

The double-fine mechanism

Rahman’s central allegation concerns what he described as double jeopardy. Customs’ Valuation Department inspects a consignment and imposes an on-the-spot fine for under-invoicing before releasing the goods. Other Customs and Excise units then raid the same importer’s warehouses and outlets and impose a second round of fines — with no action taken against the officials who cleared the consignment in the first place.

“This is extortion. You pay a fine and take your goods, and then pay another fine when officials raid your premises,” Rahman said. He said modern technology made under-invoicing straightforward to detect, yet enforcement remained skewed towards repeat penalties rather than prevention, and that there was “a mafia in Customs that needs to be broken.”

He said genuine importers were summoned in the morning but had statements recorded late in the evening, and were pressured to amend invoices and accept Customs rulings under threat of having premises sealed. Those who complained to senior officials were told to comply with field officers; most avoided legal recourse for fear of delays and inspections on later shipments.

Where the money goes

Rahman said fines range from Rs. 100 to Rs. 500 million, and are split 50% to a rewards scheme for Customs officials, 20% to the Customs Welfare Fund and 30% to the Treasury — roughly 70% flowing back to officials rather than the State.

Those figures track the statutory mechanism. Under the Customs Ordinance, half of net penalty revenue goes to the Customs Officers’ Reward Fund and half to the Treasury; of the Treasury’s share, 60% reaches the Consolidated Fund and 40% goes to a compensation fund used for officer welfare. That works out at 50-20-30 — exactly the split Rahman described.

What Rahman did not tell the House is that this formula was supposed to have changed. Daily Mirror reporting of 23 May 2024 — following a National Audit Office finding that more than Rs. 24,220 million had been paid to Customs officials and informants as reward money between 2012 and 2023 — quoted then Finance State Minister Ranjith Siyambalapitiya announcing a revision to 50% for the government, 5% for the compensation fund and 45% for officers, with the Finance Ministry “working to make it a law.” No public record of that amendment being enacted could be found. On the numbers Rahman cited, it has not taken effect. (That 2024 report falls outside this site’s source-freshness window and is cited here as background, not as a source for the current story.)

The container case, with a caveat

Rahman also raised the release of containers without proper inspection, saying the then Customs Director General was held accountable for abuse of authority yet was later promoted to Additional Secretary.

The Daily FT puts that figure at 320 containers and attributes the finding to a Presidential Commission. The case on record is the release of 323 red-labelled containers from the Port of Colombo without mandatory physical inspection, examined by a parliamentary select committee on which Rahman himself sits, and which voted down an opposition bid to summon the President and former Ports Minister Bimal Rathnayake. The three-container discrepancy and the difference in which body made the finding are not reconciled anywhere in the reporting.

Record revenue, unresolved integrity questions

The allegations land while an IMF mission is in Colombo for the seventh review under the Extended Fund Facility. The Fund’s 2023 Governance Diagnostic found Sri Lankan revenue administration “highly prone to corruption and rent-seeking,” singling out Customs and tax administration, and noted that despite more than 2,000 staff at each of Customs and the Inland Revenue Department, no corruption cases against officials had been reported in recent years. It recommended dedicated Internal Affairs units referring allegations to the Public Service Commission and CIABOC.

The scrutiny comes as Customs posts record collections. The department took a record Rs. 2,557.535 billion in 2025 and has collected Rs. 1,852.5 billion in the first eight months of 2026 — 28.5% above the period target and about 25% up year-on-year — against a full-year target of Rs. 2,206.995 billion deliberately set lower on the expectation that vehicle imports would fall. August alone brought in Rs. 219.3 billion against a Rs. 190.3 billion target.

One detail confirms an earlier discrepancy this site flagged. Customs reported seven-month revenue of Rs. 1,639.7 billion; adding August’s Rs. 219.3 billion gives Rs. 1,859.0 billion, about Rs. 6.5 billion more than the Rs. 1,852.5 billion eight-month total. That is the same gap that appeared in the August figures, which suggests a quiet downward revision to an earlier month rather than an arithmetic error. No outlet has addressed it.

Not reported

The Daily FT does not give the date of the sitting at which Rahman spoke, and no other verified newsroom appears to have covered the statement — Daily Mirror, EconomyNext and a domain-restricted search across the main outlets carried nothing on it. There is no response from Sri Lanka Customs, the Finance Ministry or the President’s Office, and no indication that the government intends to answer the allegations. The report does not name the Customs Director General said to have been promoted, state how many importers have actually exited the trade, or quantify the import decline Rahman describes — a claim that sits awkwardly beside Customs’ own record collections.