Sri Lanka’s long-standing duty-free vehicle permit scheme, originally designed to reward senior public servants and reduce state costs on official transport, has come under fresh criticism after revelations that thousands of permits were issued despite a strict vehicle import ban.
Since 2020, the Finance Ministry has issued 25,508 duty-free permits to government employees, a senior official confirmed. These permits, which offer tax concessions of up to Rs. 3.6 million, were distributed even after the government suspended vehicle imports to conserve foreign exchange. However, recipients remain unable to use them, as no decision has been made to allow imports under the scheme.
Finance Ministry records reveal fluctuating distribution numbers over the years: 5,373 permits in 2020, 2,972 in 2021, 3,340 in 2022, 5,718 in 2023, 6,062 in 2024, and 2,043 so far in 2025. While the ministry insists the scheme remains suspended, questions are mounting over why such permits continued to be issued during a period of severe import restrictions.
Critics argue that the scheme has strayed far from its original purpose. Instead of serving as an incentive to retain skilled public servants and cut official vehicle costs, it has allegedly become a privilege for parliamentarians and senior officials. Public interest groups claim many permits have been sold or transferred to third parties for profit, effectively turning a state benefit into a tradable commodity.
The lack of transparency and accountability has only deepened public frustration. At a time when Sri Lanka is struggling to rebuild foreign reserves and manage external debt, issuing permits that could eventually trigger further foreign currency outflows is seen as poor fiscal management.
Activists stress that the government must urgently explain how it intends to manage the existing stock of permits. “This is not just a question of vehicle imports, but one of trust in how public resources are handled during economic crises,” one watchdog group observed.
The Finance Ministry is reportedly reviewing reforms to restore credibility to the system. Proposals under discussion include digitising the permit process, enforcing strict non-transfer rules, restricting eligibility to essential service roles, and introducing alternatives such as transport allowances or vehicle subsidies.
Analysts argue that a thorough audit and public disclosure of all permit holders is essential to ensure accountability. Without such measures, they warn, the system risks continuing as a loophole for privilege rather than a genuine incentive for long-serving public servants.
