NEW DELHI— A high-profile tax fraud investigation has shaken Sri Lanka’s electric vehicle market, with blue-chip conglomerate John Keells Holdings PLC (JKH) facing scrutiny over alleged misclassification of imported BYD Atto 3 electric SUVs. Authorities estimate the potential tax evasion could exceed ₹3 billion.
The controversy centers on JKH’s subsidiary, JKCG Auto, which reportedly imported more than 1,000 BYD Atto 3 electric vehicles. According to Lanka News, the Sri Lanka Customs Department has detained a shipment of these vehicles at the Port of Colombo due to discrepancies in their declared motor capacity — a key factor in determining import duties.
Import documents allegedly stated that the vehicles were equipped with 100kW motors, which would qualify for a lower import tax of approximately ₹2.4 million per unit. However, inspections and independent technical assessments have raised red flags, suggesting the SUVs may actually have 150kW motors, which would bump the duty up to around ₹5.4 million per vehicle.
If the higher classification is confirmed, the resulting shortfall in duties could total billions of rupees in unpaid taxes.
Most of the vehicles in question have reportedly already been sold and registered to private owners. Some buyers have allegedly been informed that they could face retroactive tax demands or even vehicle recalls depending on the outcome of the investigation.
John Keells Holdings has denied any wrongdoing, asserting that the vehicles were imported in accordance with official manufacturer documentation. The company maintains that the Sri Lankan variants are factory-tuned to 100kW, similar to configurations sold in markets like Nepal and Singapore.
Nevertheless, the Directorate of Revenue Protection at Sri Lanka Customs has launched a forensic audit of every BYD Atto 3 unit brought into the country since 2023, including those already sold to consumers.
Industry analysts caution that if over 1,000 vehicles are reclassified as having higher-powered motors, individual buyers could be saddled with additional tax liabilities of up to ₹4 million each — potentially sparking a wave of legal action and consumer backlash. (Source: IANS)
