Hajj/Umrah operators found concealing income: 334 major cases detected

The Directorate General of Intelligence and Investigation, Inland Revenue has detected 334 major cases of travel agents and Hajj/Umrah operators in Lahore, who earn huge profits every year, but find no time to file their income tax returns.
Sources told Business Recorder here on Friday that on the directives of Shahid Hussain Asad Director General, Directorate of Intelligence and Investigation, Inland Revenue, Regional Tax Office-II (RTO) Lahore has launched a massive campaign to broaden the tax base by bringing the big unregistered businesses into the tax net.
As a result of effective enforcement, provisional assessment under section 122(C) of the Income Tax Ordinance 2001 has been made in 96 cases of travel agents and Hajj/Umrah operators and demanded Rs 11.805 million as tax after fulfilment of legal formalities. The Chief Commissioner RTO-II remarkable performance in detection of 334 major cases of travel agents and Hajj/Umrah operators in Lahore is praiseworthy.
Under the on-going documentation drive, DG I&I, the agency is under the process of securitizing data of 630 Hajj and Umrah operators in all major cities. The directorate has analysed that generally Hajj and Umrah operators are paying very less income tax as compared to the actual profits made by them. There are visible cases of income concealment when we take into account profits against actual payment of income tax. The Hajj and Umrah operators are not declaring their correct income for payment of taxes. The directorate of Intelligence Inland Revenue has approached the Ministry of Religious Affairs for obtaining data on quota allocated to each Hajj and Umrah operators. On analysis, the agency would be in a position to know the actual quota utilised by each Hajj and Umrah operator.
Under the law, it is a requirement that every Hajj operator should from a private limited company with minimum paid up capital of Rs 5 million. Taking into account the minimum paid up capital, actual amount of income tax paid is very low. The Hajj and Umrah quota is fixed by Ministry of Religious Affairs. Every Hajj company offers different packages ranging from Rs 3-4 lakh per person to expensive package Rs 15-20 lakh per person. There is a higher amount of profit in expensive Hajj and Umrah packages offered to general public.
Once the agency obtains detailed information about the Hajj and Umrah operators from the Ministry of Religious Affairs, it would be in a better position to determine their accurate income. The RTO-II Lahore has already initiated exercise for accurate assessment of income tax of such operators.
Details of the cases of travel agents and tour operators in Lahore revealed a strategy has been devised to collect third party information from trade bodies and regulatory authorities. Based upon, this information notices have been issued to such business entities who are not on the tax roll.