Telenor Pakistan in trouble after nonpayment of tax

• KPRA says that non-payment of tax falls under the category of "Tax Fraud."

Non-payment of monthly sales tax has come on to bite telecom service provider Telenor Pakistan , after the company owned by Norway’s Telenor Group was issued a show cause notice by the Khyber Pakhtunkhwa Revenue Authority (KPRA).

According to a notice sent to Telenor by KPRA, the company did not pay tax to the revenue authority, despite collecting tax from the users, KPRA said that non-payment of tax falls under the category of "Tax Fraud" .

“Whereas it has been reported to the KP Revenue Authority that you: M/s Telenor Pakistan (Pvt) Limited Registered with the Authority as a service provider with registration KNTN 2046004-0 (enrolled on 16-08-2013) have failed to file your monthly sales tax return (which must be true as per legal requirement) as required under section 52 of the KP Finance Act, 2013 read with para 18 of the KPRA Sales Tax on Service Regulation, 2017 and have not paid KP sales tax on communication services in terms of section 26 and 34 of the said Act read with para 26 of the said Regulations from June, 2019 onwards,” said KPRA in a statement.

The KP Revenue Authority has sought clarification from Telenor by January 8, the authority has also indicated that action will be taken if proper explanation is not given.

KP Revenue Authority strict enforcement starts across the board. Notice served to suspend registration of @telenorpakistan for not paying taxes for last 6 months despite collecting it from KP customers. Similiar strict actions underway against other companies and businesses in KP pic.twitter.com/Kwf4ZMIKIO

— Khyber PakhtunKhwa Revenue Authority (@kpra_official) 1 January 2020

Telenor's version: Telenor Pakistan has been making a positive contribution to the society and economy and is one of the largest contributors to the national exchequer which stands over PKR 300 billion in the form of direct and indirect taxes. As one of Pakistan's largest taxpayers, we understand the importance of the taxes we pay in supporting national development and growth of communities. We always take a responsible approach with respect to our tax obligations. We are committed to meeting all legal obligations and carrying out our operations in strict accordance with the laws of the land.