The Khyber Pakhtunkhwa Revenue Authority (KPRA) on Thursday issued suspension of Registration Notice to one of the biggest Telecom Companies of Pakistan for not paying due taxes for the last six months despite collection from their users/customers.
This extreme measure came as a last resort after issuing several notices and meetings, to comply under the relevant Law and deposit the due taxes to the Provincial government, according to a press release issued here. The decision to take large-scale action against the services associated with other sectors.
The Authority has decided to contact the Pakistan Telecommunication Authority and other competent agencies for cancellation of registration of companies that violate sales tax on services (STS) laws. According to details, the KPRA issued a notice of suspension of a registration to a company relating to tele-communication service for non-compliance of sales tax on services.
KPRA is an authorized entity to collect sales tax on services, under the Finance Act 2013. However, in June 2018, the Supreme Court of Pakistan took suo moto action and issued an order of the suspension of withholding income tax and sales on the said services.
It is worth mentioning that few of these Tele Communications Company keeps withholding STS from their consumers and were failed to submit in the government treasury. Stakeholders filed an appeal against the Supreme Court decision, which resulted in the Supreme Court reinstated sales tax on services (STS).
Despite the suo moto of the Pakistan Supreme Court, some of the telecommunication companies were not paying to the provincial government despite regularly collecting tax from their consumers and kept submitting null returns for receiving input adjustments.
It has come to the knowledge of the KPRA that few telecommunication companies deducting tax on services and do not pay it to the concerned authority. KPRA issued a notice of registration suspension notice and taking action against such entities, and letting them submit the arrears within seven days as per laws.
According to the press release, "Director General Khyber Pakhtunkhwa Revenue Authority Tahir Orakzai directed the concerned officials to take immediate action against all those service providers and individuals who do not pay STS."
He said that "despite the notices, if the aforesaid institutions failed to pay the charges, the relevant organization registration will be cancelled. He said that tax payment is a national duty and evasion of the public money will not be tolerated."