ISLAMABAD: The Federal Board of Revenue (FBR) is not in favour of ‘name and shame’ policy for the tax evaders involved in tax frauds and beneficiaries of fake/flying invoices.

Sources told Business Recorder that the FBR will continue with the policy of arresting Chief Financial Officers (CFOs) involved in fraudulent business of fake/flying invoices. However, it would not be appropriate to publicize names of these individuals. The main purpose of exercise is to recover the due amount of tax along with penalties/additional tax/default surcharge etc.

Once the unpaid amount of tax has been fully recovered from the tax evaders, there is no need to publicly disclose names of these persons. This is for the first time in the history of Pakistan that action is being taken against the big fish and CFOs of those leading companies involved in abetment/connivance in sales tax fraud. Officials stated that there is full political backing of the government for taking action against the individuals/companies involved in tax fraud cases.

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Only in one case, huge amount of evaded sales tax (principal amount and penalty) was deposited by a leading textile exporter of Faisalabad.

The revenue loss caused by the fraudulent practices involving a gang of fraudsters runs in hundreds of millions of PKR to the national exchequer. These arrests were executed in the wake of the country-wide crackdown against the organised mafia and beneficiaries involved in sales tax fraud and in line with the FBR’s enforcement measures to enhance tax compliance. This is for the first time that the CFOs of big textile companies have been arrested.

The FBR has asked the CFOs to pay the due amount of unpaid taxes of billions including principal amount and additional tax/penalties to avoid prosecution, the sources revealed.

Copyright Business Recorder, 2024