FAISALABAD: The Regional Tax Office (RTO) Faisalabad has unearthed a dozen Benami accounts besides going after big sales tax evaders as part of government’s campaign against tax evasion.
“The RTO Faisalabad’s decision to go after the tax evaders has started yielding results. It has so far achieved 43% growth in tax collection in an otherwise low tax collection environment at the national level,” said Chaudhry Muhammad Tarique, Chief Commissioner of RTO Faisalabad according to media reports.
Tarique revealed that growth in income tax collection was just 10%, but growth in overall tax receipts came in at 43% for the RTO. This came despite 1% lower withholding tax collection in July-January of the current fiscal year.
Faisalabad is Pakistan’s third largest city and is known as the second commercial hub after Karachi. Yet its contribution has historically remained very thin due to the culture of tax dodging, which often leads to tax fraud, such as flying invoices.
There are only 123,445 income tax return filers in Faisalabad, who constitute nearly 8% of total filers in the country. In such an environment, the only option left with the RTO Faisalabad is to broaden the tax base by going after the tax dodgers. “This is exactly what we are doing,” said the chief commissioner.
“The FBR’s intelligence wing has unearthed 12 Benami accounts; our teams have also uncovered a mega fraud committed by three mills in Jhang, which understated their sales through fake sale and purchase invoices to evade taxes,” said Tarique. “From these tax dodgers alone, the FBR will recover an additional Rs93 million in taxes.”
The tax department has also decided to register cases against the people who are involved in tax fraud. The chief commissioner believes that tax recovery can get a boost by establishing an effective and swift accountability mechanism. Over Rs14 billion worth of sales tax and income tax was stuck due to cases filed in courts, Tarique said, adding the RTO had selected 62,000 audit cases and recovered Rs700 million in January 2019.
He pointed out that the current government had turned focus to improving the adjudicating process by deciding cases at Commissioner Appeals and tribunal levels, which would lead to early settlement of tax disputes and release of the stuck amount, he added.
In the past few months, about 123,445 taxpayers filed tax returns, the number was higher than the previous year. Of these, 37,925 taxpayers were from the salaried class and 85,520 were businessmen.
