Rs100 billion tax-dodging uncovered in four months

by Ayesha javed on November 14, 2019 | Images Source Social Media


During the last four months, senior tax officials revealed, the corporate sector has been involved in at least Rs100 billion in tax-dodging and avoidance.

Large Taxpayers Unit (LTU) Karachi, the biggest income-collecting support of the FBR, uncovered Rs100 billion worth of tax fraud in July to October period of the current financial year, officials revealed during a press conference.

In the ongoing audit and examination, the unit detected Rs100 billion as tax avoidance/dodging by at least 12 companies, senior officials of LTU Karachi said. They, however, did not reveal the names of tax-evading companies.

Domestic income commissioners Zulfiqar Memon and Girdhari Mal shared about the performance of the unit as part of Chairman of FBR Shabbar Zaidi’s instructions.

Mal said one single case involved the tax suppression of Rs23 billion. He further added notices have been issued to the companies for recovery of the escaped amount.

The commissioner said LTU posted 16% income collection growth during the first four months (July – October) 2019/20. He attributed the growth to reforms initiatives taken by the government.

“The growth in income is a bonus of the financial activity,” he said.

Read more: Pakistan To Get $8 Billion Investment From Russia After Resolving 40 Years Old Trading Clash.

Tax officials said the banks were the major income rotators during the first four months of the current financial year. Besides factories, oil marketing, and textile companies also performed well in income contribution, he added.

The LTU Karachi released Rs21 billion as sales tax repayment during the period under review after the change of sales tax government effective from July 1, 2019.

Memon said the law of information sharing from banks to tax consultants was introduced in 2013. However, the law has been remained by the courts. The FBR is incompetent to receive information with the exclusion of specific/identified cases from banks.

Recently a court advised the FBR and the Association of Pakistan Banks to resolve the issue. Officials also said LTU Karachi identified about 100,000 individuals who have commercial gas connections but are not required to register sales tax.

The officials said the Large Taxpayers Unit collected information from the Sui Southern Gas Company and other tax offices and cross-checked it with the list of individuals registered for sales tax.

The LTU Karachi has authority over 5,056 units. The unit has authority over a company having over Rs400 million turnover or Rs20 million as tax influence in a year.

Speaking about the recent improvements initiatives by the government as well as proposed creation of Pakistan income Authority, the officials said the filed units are not against the government plan. 

However, the FBR chairman had assured the employees of addressing their complaints related to the improvement program.

Read more: Pakistan Petroleum Ltd To Start Zinc Exports Amid Shift From Fuel

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Ayesha javed


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