A bombshell tax evasion scandal involving Chinese electric vehicle maker BYD and its Sri Lankan agents could be costing the government billions. Allegations suggest brand-new cars are being fraudulently declared with downgraded specs to dodge taxes, while more powerful used vehicles slip through at a fraction of the cost. Lawmakers now demand answers over suspected political protection and customs collusion.
A high-profile tax fraud scandal involving Chinese electric vehicle manufacturer BYD and its Sri Lankan partners has erupted, threatening to expose serious breaches in customs enforcement and corruption at the highest levels.
Samagi Jana Balawegaya MP Mujibur Rahuman has accused BYD and its local agents of running a systematic tax evasion racket. The scheme reportedly revolves around under-declaring vehicle specifications to avoid paying millions in import duties.
Rahuman highlighted glaring discrepancies in the import tax valuations of the popular BYD ATTO 3 model. A new vehicle allegedly listed at 100 kilowatts (kW) is taxed at Rs. 5.5 million, while a more powerful used version with 150kW is taxed at only Rs. 1 million. The Rs. 4.5 million gap per vehicle raises serious questions.
Citing BYD’s own website, Rahuman told Parliament that the company does not manufacture a 100kW version of the ATTO 3—only a 150kW model exists. He accused importers of deliberately manipulating the system. “It’s a blatant racket. How can a more powerful, used vehicle attract lower taxes than a new one? This reeks of fraud and collusion,” he said.
The MP further questioned whether these agents were receiving political cover, drawing parallels to the infamous container scandal. “There’s no way these vehicles are slipping through without help. Someone high up is protecting them,” Rahuman added.
With Sri Lanka still clawing back from economic collapse, Rahuman warned that such fraud undermines public trust, disrupts recovery, and sends a damaging message to the global business community.
Calling for immediate action, Rahuman urged authorities to investigate those involved. “This is more than a paperwork mistake—it’s a massive scam. Who is shielding these criminals, and why hasn’t anyone been held accountable?”
