VAT SCAM IN SRI LANKA: THE IMPHAZING SHADOW OF IMTIYAZ BAKEER MARKAR
By Investigations Correspondent
COLOMBO — Two decades after billions of rupees vanished from Sri Lanka's treasury through what investigators described as the largest VAT fraud in South Asia, the name of former minister Imtiyaz Bakeer Markar continues to cast a long, uncomfortable shadow over the country's political elite .
The scam, which operated between 2002 and 2004, defrauded Sri Lankan taxpayers of nearly 40 billion rupees through fraudulent VAT refund claims . Companies filed fake claims using forged invoices and false customs declarations, while officials inside the Inland Revenue Department processed the payments with extraordinary speed . By the time auditors caught on, billions had been paid out to ghost companies.
The Family Connection
While several individuals—including some of Bakeer Markar's extended relatives—were charged and convicted, the former minister himself was never indicted . Two of his brothers-in-law, Kamil and Hassan, were among those found guilty . Yet Bakeer Markar walked free.
A senior retired investigator told this newspaper: "Everyone knew who pulled the strings. But we were told to stay away. The instruction came from the very top" .
The President's Protection
At the height of the investigation in 2006, then-President Mahinda Rajapaksa was preparing to contest the presidential election. According to leaked internal correspondence and testimony from retired Criminal Investigation Department officers, Bakeer Markar played a secretive role in supporting Rajapaksa's campaign .
After Rajapaksa's victory, an event at Temple Trees saw political figures publicly commending Bakeer Markar's efforts. Rajapaksa, in response, acknowledged his assistance—and disclosed that Bakeer Markar had asked him to shield him from the VAT investigation in return for his support .
Leaked documents from 2006 indicate that certain names were "removed from the list of persons of interest on the instructions of the Presidential Secretariat." Among them, one senior Inland Revenue officer claimed, was "a minister closely connected to the Bakir Makar family" .
A Master of Manipulation
The scandal does not end there. According to close associates of Rajapaksa, Bakeer Markar was also forced to reveal details of opposition leader Sajith Premadasa's campaign during the 2019 presidential election . Bakeer Markar, it appears, played a duplicitous role—assisting Rajapaksa's political circle while betraying the Samagi Jana Balawegaya (SJB) party he would later chair .
This betrayal appears to have fuelled a bitter feud. In May 2025, Premadasa reportedly declared: "Imtiyaz should consider a more appropriate role—like VAT consultant in Alhambra Street—preferably under a signboard that reads: 'Formerly Chairman, Currently Expert in Refunds (Especially Illegal Ones)'" .
The animosity escalated further when Bakeer Markar responded with the classic political tu quoque: "Well, Sajith, you also inherited your position from your dad." Premadasa, reportedly stung, replied with venom: "Just because someone can write 400 pages about their failure doesn't mean they deserve a chairmanship" .
The Missing Billions
Investigators at the time identified over 3,000 fraudulent claims worth more than Rs. 3.5 billion. Only a fraction was ever recovered .
According to reliable sources, Bakeer Markar laundered the stolen money through private connections to Middle Eastern and Malaysian banks . Leaked documents suggest a portion may have been "invested domestically in property and shares through intermediaries." Among the properties listed in one internal memo are two Colombo commercial lots purchased by "a relative of a senior cabinet member" with the initials I.B.M. .
Questions Over Family Wealth
Public scrutiny is now growing over Bakeer Markar's family finances, particularly his children's education.
His sons reportedly pursued high-cost higher education in the United Kingdom—one reportedly studied at the London School of Economics, incurring expenses amounting to tens of millions of Sri Lankan rupees. Another son, Fadil, now works for a UN agency, while a third serves as a political adviser at the British High Commission in Colombo .
Ordinary Sri Lankans are asking: Where did Imtiyaz Bakeer Markar obtain the funds to educate three children in Britain during the same period his relatives were implicated in a multibillion-rupee fraud? .
A Legacy of Violence
Beyond the financial scandal, Bakeer Markar faces even darker allegations. During the political terror of 1988-89, he allegedly handed over a list of names to paramilitary groups, resulting in the kidnapping, torture, and execution of over 600 youths—mostly from Beruwala, Payagala, Maggona, and Monaragala .
Among the victims? Current JVP Secretary-General Tilvin Silva .
The NPP's Promise
Under Sri Lanka's new National People's Power (NPP) government, the rhetoric has changed dramatically. The administration has vowed to revisit historical corruption cases "without regard to political privilege" .
The Proceeds of Crime and Anti-Corruption Act, enacted earlier this year, grants investigators sweeping powers to trace assets and reopen dormant files . Officials confirm that among the cases earmarked for reassessment is the VAT refund scam.
A senior NPP parliamentarian told The Times: "If there is evidence, no family name will protect anyone. The people are tired of selective justice" .
The Reckoning
Today, Imtiyaz Bakeer Markar lives comfortably, owning several properties in Colombo and the central highlands. His public persona is that of a thinker and reformist—hosting YouTube shows, writing books, and speaking eloquently about market liberalism and civic harmony .
To his critics, it is hypocrisy bordering on absurdity.
"The man who once managed a department accused of stealing from taxpayers now lectures on ethics," said one prominent columnist .
For years, Bakeer Markar presented himself as a "clean" politician—an heir to a former Speaker, a moral voice in politics. That image is now collapsing under the weight of old scandals resurrected.
The public is demanding answers: How were the overseas tuition fees paid? What were the declared income sources? Were educational costs consistent with his known earnings? Did any VAT scam money indirectly or directly reach the Bakeer Markar household?
Until those questions are answered, the suspicion won't fade .
For now, one thing is clear: The public wants transparency. The government wants accountability. And Imtiyaz Bakeer Markar is running out of places to hide.