Reducing risk of sales tax fraud: FBR places curbs on various activities, transactions
ISLAMABAD: The Federal Board of Revenue (FBR) has placed restrictions on various activities and transactions of sales taxpayers aimed at reducing the risk of sales tax fraud.
On Friday, some important amendments have been made to the Sales Tax Rules of 2006 by the FBR. These amendments have placed restrictions on various activities and transactions aimed at reducing the risk of tax fraud.
A leading Karachi-based sales tax expert informed that very important notification has been issued by the FBR having serious compliance implications on the business community.
Fake/flying invoices: Taxmen told to conduct probe into cases of big cos
Recently, the Federal Board of Revenue (FBR) uncovered a significant tax fraud involving the issuance of fake and false invoices by unscrupulous individuals to circumvent the electronic system’s checks and balances. It appears that in order to address the loopholes identified through this case study, the law has been updated with more stringent conditions through these amendments.
Declaration of Business Capital to Commissioner – Rule 5(2) (f):
All new registration for importers, commercial exporters, Tier-1 retailers, wholesalers, and distributors as individuals, AOPs, and single-member companies are subject to submission of balance sheet showing the amount of business capital along with corresponding assets in the bank within 30 days. Failure to do so will require such registered persons to seek permission to file sales tax returns through IRIS.
All the persons already registered on the above category and class of persons are also required to comply with this condition, failure to which such registered persons could not file their return without to seeking permission returns through IRIS from Commissioner concerned.
Periodic Biometric Verification – Rule 5(4):
All registered individuals are required to undergo biometric re-verification every year during the months of July through Nadra e-Sahulat Centre. Failure to comply with this requirement will result in the inability to file tax returns without seeking permission through IRIS from the concerned commissioner.
Re-Introduction of Pre-Verification for ST Registration- Rule 5(5):
Pre-verification requirements before registration have been restored. Now all fresh sales tax registrations are subject to pre-certification.
Copyright Business Recorder, 2024
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