Billions of rupees being lost in tax revenue due to under-invoicing: Shaukat Tarin

Federal Minister for Finance and Revenue Shaukat Tarin said on Tuesday that the issue of "over-invoicing and under-invoicing" has been a major problem for Pakistan, adding that billions of rupees are being lost in tax revenue due to the issue.

While addressing a ceremony in Islamabad, Tarin said: "We will not tolerate this commotion anymore."

Tarin said that people have opened companies in Dubai and other places which they use for “transfer pricing.”

The minister claimed that things that come from China are being invoiced from Dubai. "Why is payment going to Dubai? Why is payment not going directly to China?" he asked.

Tarin said that Pakistan's hard-earned foreign currency is being compromised due to this issue, adding that we will have to use technology to resolve the problem.

"I am sure all of you want Pakistan’s hard-earned foreign exchange to remain in Pakistan," he remarked.

The minister said that we have to use technology all across to address the problem. "Whether it is taxation or foreign exchange and I think we will be able to make a difference through technology," he said.

"All of this process should be hassle-free. When you use technology, you end human interaction and people don’t mind or could make any excuses."

Tarin said that a single-window operation in customs will be set up in this regard. "There will be a system to compare prices with other places to check if invoices have relevancy according to their prices in other places. If they don’t have relevancy then an investigation will take place."

He commended the FIA's work, saying that they are doing great work with responsibility. "They are not making a commotion about it but they are making significant progress," he said.

"Time is not far when we achieve our true potential in taxation and foreign exchange," he added.