KARACHI: Federal Board of Revenue’s Member (Policy) Dr Muhammad Iqbal has said that the action under anti-money laundering law (AML) are being taken only on the basis of suspicious transactions reports (STRs), brushing aside the concerns the law was being triggered without any evidence.
Addressing a seminar on ‘Anti-Money Launder Laws’ and ‘Benami Laws’, organised by Karachi Tax Bar Association (KTBA), the Member said that Financial Monitoring Unit (FMU) generates STR and then sends it to the FBR for further investigation.
Responding to consultants/practitioners’ apprehensions the FBR was acting on its own under AMLs and freezing bank accounts, Iqbal said the objective of the FBR was not to compromise the dignity of taxpayer. He, however, did admit that there were cases in which the notices, sent to the taxpayers, were deficient.
Regarding green-field investments, he said there were certain exemptions that had been allowed from disclosure of information. “If no predicate offence is identified, then Benami law should not be triggered,” he added.
Earlier, highlighting the provisions of Anti-Money Laundering Act, 2010, Abid H. Shaban, advocate, Supreme Court of Pakistan, said in order to enforce this law properly secrecy law need to be amended as banks were reluctant to provide information of their accountholders.
Shaban said that under Section 165A of Income Tax Ordinance, 2001, tax authorities are empowered to take all information of transactions from banks.
“Globally, the quantum of laundered money was around $1 trillion and International Monetary Fund (IMF) has estimated the scale of money laundering to amount between 2 percent and 5 percent of global gross domestic product,” he said. He said that Pakistan had also implemented the AML but the same was needed to be amended. “At present the concealment under sales tax and federal excise laws can be dealt under AML but this law is missing income tax laws,” Shaban added.
