A special audit investigation into Sri Lanka’s new e-Visa system has revealed serious irregularities, including tax evasion, unregulated foreign remittances, and violations of procurement rules, raising concerns about transparency and accountability in a project meant to modernize the country’s visa process.
According to the audit report, GBS Technology Services and IVS Global-FZCO, operating under VFS VF Worldwide Holdings Ltd, failed to remit USD 1.418 million in taxes to the Inland Revenue Department. Between April and August 2024, the companies collected both the 2.5% Social Security Contribution Levy (SSCL) and 18% Value Added Tax (VAT) from applicants—totaling USD 172,970 in SSCL and USD 1,245,390 in VAT but did not pay these sums to the government.
The audit also found that the firms processed 373,991 visa applications during this period, earning at least USD 6.9 million in service fees. An additional USD 1.82 million was generated from 98,401 visa-exempt applications countries that were granted free visas under a government tourism promotion scheme. Despite the exemption, travelers were still charged USD 18.50 per application, a move auditors described as “unjustified and exploitative.”
Under the former Electronic Travel Authorization (ETA) system, there was no service fee, and an approved upgrade proposal had recommended only a USD 1 charge. The sharp increase to USD 18.50, even for tourists and business travelers meant to be encouraged under promotional initiatives, has drawn criticism from both tourism and legal experts, who question how the decision was authorized.
The audit further exposes procedural violations in the award of the e-Visa contract. Both the Committee on Public Finance (COPF) and the audit report note that VFS Global and its affiliates were appointed without competitive bidding or adherence to government procurement regulations. This not only deprived the Department of Immigration and Emigration of cost-effective alternatives but also undermined transparency in the awarding process.
Adding to the controversy, the report reveals that visa revenues were transferred directly to foreign bank accounts controlled by the service providers, bypassing official government financial channels. This has made it impossible for authorities to verify the actual revenue collected from visa applications, creating significant gaps in state oversight.
Auditors concluded that the Department of Immigration and Emigration lacked full visibility over the project’s financial operations, leaving public funds vulnerable to misappropriation.
The revelations have sparked renewed calls for a full parliamentary inquiry and for the suspension of the e-Visa contract until accountability is established. Critics argue that such opaque deals erode investor confidence and damage Sri Lanka’s international reputation at a time when transparent governance is vital for economic recovery.
The audit’s findings now put pressure on the Finance Ministry and the Attorney General’s Department to take swift legal and administrative action to recover lost revenue and restore public trust in state-managed digital systems.
Leave your comments
Login to post a comment
Post comment as a guest