-By LeN Economic Correspondent
(Lanka-e-News -30.July.2025, 10.45 PM) In a dramatic turn that could rattle Sri Lanka’s most recognisable beer manufacturer, a whistleblower has alleged that Lion Brewery (Ceylon) PLC—the near-monopolistic giant in the country’s alcoholic beverage market—sold millions of rupees’ worth of beer and alcoholic products off the official sales ledger, potentially evading tax and misappropriating public revenue.
The claims, which reach back to a period prior to September 2024, when the National People’s Power (NPP) government came to power, paint a troubling picture of possible systemic abuse within one of the island’s largest corporate entities.
The whistleblower, whose identity remains protected due to potential reprisals, alleges that bulk volumes of beer were distributed to certain retailers without ever being recorded in Lion Brewery’s official accounting system—a clear violation of both corporate and tax laws.
According to the source, internal records and Excise Department reconciliations may not align, suggesting that production figures were far greater than declared sales. If accurate, this would mean unreported stock was sold through parallel channels, effectively denying the Treasury millions in legitimate excise revenue.
“Every millilitre of produced beer must be taxed,” said a senior tax consultant in Colombo, speaking on condition of anonymity. “If Lion Brewery claimed losses, wastage, or stock destruction, those claims should be supported by documentation and verified by excise officers. The absence of such documentation would indicate deliberate concealment.”
The Sri Lankan Excise Ordinance and Inland Revenue Act make clear that the non-declaration of sales, concealment of revenue, and circumvention of tax obligations may amount to both fiscal fraud and money laundering, especially if funds are then laundered through informal transfer systems such as hawala.
Multiple sources suggest that the whistleblower has raised serious questions about whether some of the undeclared funds were funnelled to politicians or senior officials within the Excise Department. If verified, the implications would be far-reaching—potentially implicating members of previous political regimes, as well as corporate executives and state regulators.
A further layer of complexity emerges with allegations that some undeclared revenue was routed through India, possibly to settle payments for imports or distribute corporate “bonuses” beyond the reach of Sri Lankan financial regulators. The informal hawala network—often used for cross-border transfers outside banking channels—is notorious for facilitating illicit financial flows.
Whether this mechanism was utilised to launder money or to pay off politically exposed persons (PEPs) remains unclear. But intelligence sources believe that the Central Bank’s Financial Intelligence Unit (FIU) and the Bribery Commission (CIABOC) must now initiate a full forensic audit of Lion Brewery’s financial records and payment trails.
One key area where the truth may lie hidden is in the variation between production volumes and declared sales. Every brewery in Sri Lanka is required to report its monthly production to the Excise Department, which then cross-verifies against taxes paid and stock sold.
If Lion Brewery reported consistent production levels, but a flat or declining sales ledger, the Excise Department’s own data may offer clues. The whistleblower insists there is an abnormal gap that has not been accounted for through loss claims, expired stock reports, or inventory write-offs.
Further complicating matters is Lion Brewery’s role as the local distributor for Carlsberg, one of Europe’s most prestigious beer brands. Any loss of credibility by Lion could damage Carlsberg’s reputation in Sri Lanka and beyond, raising questions about how multinationals ensure ethical standards across franchise or distributorship partners.
Since taking office in early 2024, the NPP government led by President Anura Kumara Dissanayake has pledged to clamp down on corruption, restore fiscal discipline, and reclaim public revenue. The whistleblower’s claims offer a litmus test for that promise.
To date, there has been no formal statement from Lion Brewery, nor any visible enforcement action by the Excise Department, Inland Revenue, or the Finance Ministry. However, civil society groups and media platforms like Lanka e-News are demanding transparency.
“We are on the side of the public,” said a spokesperson for Lanka-e-News. “The question now is whether this government is prepared to follow the evidence—wherever it leads.”
Efforts to reach Carlsberg’s headquarters in Copenhagen for comment have so far been unsuccessful. However, international norms dictate that any allegation of financial impropriety or corporate misconduct within a licensed distributor’s operation must trigger an internal investigation and reputational risk review.
If Carlsberg is aware of these allegations and remains silent, the Danish giant could risk complicity. Investors and ESG watchdogs in Europe may begin asking tough questions.
This whistleblower’s claim is not just about beer. It’s about whether powerful corporations can operate above the law in Sri Lanka. It’s about whether public revenue—needed for schools, hospitals, and infrastructure—is being siphoned off into the shadows.
It’s about whether the new Sri Lankan administration will have the courage to confront a legacy of impunity, elite privilege, and corporate capture.
The nation will be watching. So will we
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by (2025-07-30 17:25:01)
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