Sri Lanka Customs, long criticized as a state institution riddled with corruption and inefficiency, has delivered a startling turnaround in revenue collection this year, defying expectations and raising eyebrows across government and business circles. Official figures reveal that total revenue by the end of November has already reached 107 percent of the full-year target, a feat previously considered nearly impossible given the agency’s tarnished reputation.
The Customs set an ambitious target of LKR 2,115 billion for 2025 36.2 percent higher than last year’s LKR 1,553 billion. November alone was projected at LKR 210 billion, yet Customs managed to collect LKR 245 billion, despite a four-day operational halt due to Cyclone Ditwah. Overall, revenue from January to November reached LKR 2,260 billion, compared to LKR 1,367 billion in the same period last year, marking a dramatic 65.3 percent increase.
Experts suggest that this leap is not merely due to a recovery in trade but reflects a combination of tighter enforcement, stricter valuation practices, and heightened scrutiny of under-invoicing and misdeclaration. Following the 2022 economic crisis, import activity had plummeted as the government imposed foreign exchange restrictions. However, with stabilizing reserves, the easing of certain import controls, and a gradual rebound in consumer demand, Customs has tapped into previously under-reported revenue streams.
Observers note that the jump raises questions about prior years’ performance. If stricter monitoring and valuation practices can yield a 65 percent increase, critics argue, how much revenue was lost in the past due to inefficiency, mismanagement, and alleged corruption? Former officials and watchdogs have long accused the institution of systemic laxity, but current results suggest that rigorous enforcement, when implemented, can have immediate and significant fiscal impact.
Analysts also point to currency movements and rising import volumes as contributing factors. Import duties, excise, and other levies have surged, transforming Customs into one of the top revenue contributors to the Treasury this year. The agency’s performance provides a crucial buffer as Sri Lanka pursues fiscal targets under the IMF-supported economic program, potentially reshaping perceptions of a department once seen as a liability into a surprising engine of state revenue.
