Strategy to expand tax net, detect evasions: review conference of all intelligence officials convened on September 17

Directorate General Intelligence and Investigation, Inland Revenue (IR) Federal Board of Revenue (FBR) has decided to convene a national conference of all intelligence officials including Directors and Additional Director I&I IR to share the plan and operational strategy to expand tax net and detect sales tax, income tax and federal excise duty evasion in 2012-13.
Sources told Business Recorder here on Monday that the directorate would organise the first review conference on September 17, 2012, which would be addressed by the FBR Chairman Ali Arshad Hakim. Director General I&I DG and former FBR Member Tax Policy and Reforms Khawaja Tanveer Ahmed would share his experience in tax frauds detection and measures to check fraudulent activities through policy initiatives.
Khawaja Tanveer Ahmed would highlight various tasks to be undertaken by the directorate for the generation of revenue, plugging leakages, creating deterrence and significant achievements during July and August, 2012. The presentations would be made by Directors of Intelligence from Karachi and Faisalabad. The agency and its field officials would also finalise the national implementation plan and roadmap for documentation of economy and identify priority sectors for detection of concealment of income and evasion of taxes.
The quarterly conference of supervisory officers- I&I-IR would also discuss major achievements of field formations in different sectors. Directorate General I&I, Inland Revenue is though quite a recent addition to FBR's hierarchy, yet within short span of one and a half year, it has emerged as a dependable departmental investigating agency. As, for any vibrant public sector organisation periodical performance appraisal/ review sessions constitute the timely checkmate, therefore first review conference of supervisory officers of I&I-IR is being scheduled on September 17, 2012 at FBR HQs Islamabad. Agenda of the session is attached herewith.
All Regional Directorates I&I-IR shall make brief presentations (15/20 minutes) covering yearly performance for FY 2011-12; performance during July-August 2012 and work plan for 2012-13 along with operational strategy. All Directors and Additional Directors of intelligence IR shall attend the said session.
During the quarterly conference of supervisory officers- I&I-IR presentations to be made by Director I&I-IR Karachi; Director I&I-IR Lahore; Director I&I-IR Faisalabad II and Director I&I-IR, Islamabad. Sharing major achievements of the directorate, sources said that after the desk scrutiny, 16 new cases wherein sales tax has been evaded are being forwarded to FBR for grant of approval to conduct investigative audit and lodging FIRs. The potential of revenue involved is these cases works out to be Rs 260 millions approximately.
The FIRs were lodged in 06 cases with their Sales Tax Registration Numbers (STRNs). The revenue involved in these cases is approximately 165 million. The proceedings were initiated against 5 beverages and cigarettes manufacturers of Peshawar/KPK for failure to pay FED and Sales Tax and recovery amounting to Rs 31.999 Million was made. Directorate has made a seizure of tobacco/cigarettes involving FED Rs 772.200/- and Sales Tax worth Rs 197,505/- in Sargodha.
Sources said that different Directorates' of the Directorate General (I&I) IR, cumulatively recovered Rs 106 million during July and August 2012. In an action u/s.38 of the Sales Tax Act, 1990 in Karachi the record of four registered persons was obtained. The record has been examined and it is detected that these units have claimed inadmissible refund and adjustment of input tax amounting to Rs 80 millions.
The contravention reports in 14 cases based on market survey, mystery shopping etc was forwarded to concerned RTOs/LTU with Rs 76.9 million tax involved. Two cases have been finalised and recovery of Rs 3.21 millions effected. The proactively eleven 'Red Alert' signifying risk areas to be examined by the respective RTOs / LTUs before issuance of refunds were issued against refund claims of Rs 71 million.
Other initiatives of the directorate included detection of non-payment of Special Excise Duty against a company in minerals' sector wherein revenue loss of Rs 11 Millions is involved. The mineral sector has similar nature of cases. An exercise was conducted in the case of prominent Pakistanis to ascertain whether they are paying taxes properly. Comprehensive tax profiles in the cases of 21 national cricketers, 36 media/showbiz persons and three parliamentarians were prepared and shared with field formations.
To check whether the franchisees of multinational pharmaceutical companies are paying FED on royalty paid to their franchisers, cases of 221 pharmaceutical companies have been forwarded to field formations with necessary guidelines for processing, sources said.
The directorate had convened meetings with the legal advisors regarding litigation issues. They are requested to get all stays' granted by superior courts vacated and get early date of hearings for speedy disposal. The above performance can be further enhanced manifold provided FBR resolves legitimate logistic issues of the Directorate General earlier, sources added.