Pandora Papers: Only 70 to 80 Pakistanis identified by FBR so far

ISLAMABAD: The Federal Board of Revenue (FBR) has so far identified only 70-80 Pakistanis named in the Pandora Papers having offshore companies in tax havens aboard.

Sources told Business Recorder Friday that the data of the 700 Pakistanis having offshore companies has not been updated on the ICIJ website.

Once the data is available on the ICIJ website, it would be easy to identify these persons, their CNICs, and declared addresses.

So far, the FBR's offshore tax zones have identified 70-80 Pakistanis named in the Pandora Papers.

Sources said that many of the owners of the offshore companies might have availed the Assets Declaration Scheme (2018) of the PML-N, and the Assets Declaration Ordinance 2019 (2019) of the PTI government.

Over 700 Pakistanis named in ICIJ's 'Pandora Papers'

They apprehended that the current FBR exercise would have the same fate as had happened in the case of Panama Papers. Tax experts are of the view that the FBR effort will prove to be an exercise in futility just like it had in the past.

According to the sources, it is a time consuming exercise because tracing the persons and their actual available addresses is not an easy task.

When contacted, tax experts told this scribe that the FBR has not taken action against the Pakistanis appearing in the Panama Papers in 2016. The new exercise would face the same fate as had happened in case of the Panama Papers.

In 2016, Director General, Intelligence and Investigation Inland Revenue had sent out tax notices to 336 individuals out of total 444 while 133 had responded to these notices. Certain constraints were there before starting the assignment on the Panama Leaks, because incomplete information was published by media.

However, 444 cases were found by Intelligence & Investigation, accordingly FBR investigated and traced down 303 addresses. He further said that notices were issued under section 176 of the Income Tax Ordinance, 2001, to these individuals.

TI-P wants probe against Pakistanis named in 'leaks'

At the same time, the Securities and Exchange Commission of Pakistan (SECP) has found that no direct investment has been made by the companies registered in Pakistan in the offshore companies listed in Panama Papers.

It was revealed that no direct investment had been made in off-shore companies by the companies registered in Pakistan relating to identified individuals as per the financial statements available at SECP. The available record reflects, prima facie, the investments as mentioned in the Panama Papers were made by the persons in their individual capacity and same has not been routed through any company's accounts.

The Companies law does not restrict the companies from making investments in foreign jurisdictions. However, an investing Company has to comply with the relevant provisions of the Ordinance at the time of making such investments which inter alia includes approval from the board of directors and approval from shareholders only in case of associated companies. Hence, there is no other bar or restrictions on making foreign investment as per laws administered by SECP, it said.

Copyright Business Recorder, 2021