Consumers face absurd costs due to e-commerce tax system: Harsha
Colombo, July 05 (Daily Mirror)- Consumers are facing absurd costs for items purchased through e-commerce platforms after the Sri Lanka Customs had scrambled to revert to HS code-based taxation without a proper framework, Chair of the Committee on Public Finance (COPF) Dr. Harsha De Silva said.
He said in a statement posted on X that an item of Rs. 500 can incur Rs. 37,000 in charges.
"On June 3, 2025, our COPF inquiry exposed Customs’ informal weight-based tax system for e-commerce, which lacked legal backing for years. The government’s inaction allowed platforms like Temu to flood our market with untaxed bulk imports, undercutting local SMEs and taking undue advantage of the loopholes in the law. Then, when this practice had come to light in April during meetings with stakeholders, the Customs had scrambled to revert to HS code-based taxation, but without a proper framework, and consumers are now facing absurd costs—a 500 LKR item can incur 37,000 LKR in charges! This inefficiency hurts shoppers, businesses and our economy," he said.
The MP said as Chair of the Committee on Public Finance (COPF), he was committed to building a fair and transparent economy for Sri Lanka and that recent claims accusing him of curtailing e-commerce are baseless and misleading.
"Let’s set the record straight and address the real issue," he said.
"I’m advocating for a dedicated and simplified HS codes for B2C e-commerce and vendor-collected taxes, like VAT systems in the EU and Vietnam, to ensure fair pricing, protect local SMEs and boost transparent revenue collection. E-commerce should empower consumers and entrepreneurs, not penalize them. I’m fighting for a system that supports YOUR aspirations—affordable online shopping, thriving local businesses and a stronger Sri Lanka," he said.
