Khakwani concerned at tax evasion

August 16, 2012

RECORDER REPORT

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Federal Revenue Alliance Employees' Union (FRAEU) spokesman in Multan Riaz Ahmed Khan Khakwani, showing its serious concern over the tax evasion of over Rs 300 billion by around 1,200 so-called foreign companies (AOPs), has asked the newly-appointed FBR Chairman Ali Arshad Hakeem to immediately issue a circular to annul the tax exemption of all AOPs as per directives of the FTO.

Showing his resentment over the delaying tactics of the FBR authorities to bring 1200 AOPs in the tax net, according to him, FBR Union central president Mian Abdul Qayyum alleged that Islamabad tax officials are constantly keeping mum and did not bother to just reply the letter of the Union, in which it has unveiled the scandal of Rs 300 billion per annum loss to national kitty which some FBR high-ups were trying to cover up.

He further said that the FBR Union in a letter to all FBR members and all Inland Revenue chief commissioners has identified those companies. In that detailed letter, backed by concrete calculations and strong evidence, the union has made out that over 1,200 such resident companies are not paying taxes despite that some of them have lost cases in the court of Federal Tax Ombudsman (FTO). Following the FTO decisions in favour the department, the FBR, instead of issuing a circular to collect taxes, is favouring them by remaining silent, the union spokesman said.

He stated: "Around 1,200 so-called foreign companies, which entered into joint ventures with Pakistani firms and became 'resident persons', are found to be evading tax, rather claiming refunds as their proprietors are portraying themselves as 'non-resident persons', inflicting about Rs 300 billion annual loss on national exchequer.