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ISLAMABAD: The government has initiated recovery proceedings against over 200 super-rich people of Karachi, who were reluctant to pay the Capital Value Tax (CVT) to the tune of Rs3 billion on their foreign assets held abroad. Sources told Business Recorder Friday that out of Rs3 billion recoverable, Rs1.3 billion has already been recovered from these super-rich individuals.

The attachment of the bank accounts of these people has been started in the first phase.

The Federal Board of Revenue (FBR) has adopted coercive measures against these super-rich individuals who failed to pay CVT on foreign assets. The FBR has issued orders against 200 rich people after their failure to respond to repeated notices.

The policy is to take action against the elite class who are not ready to pay the due amount of taxes. The relevant Automatic Exchange of Information (AEOI) Zone of the Large Tax Office (LTO) Karachi has taken this bold step against the super-rich defaulters of the CVT after the fulfillment of all legal formalities and procedures.

CVT on foreign assets, tax on ‘deemed income basis’: FBR decides to publish richest defaulters’ names

So far, 40 bank accounts have been attached and an amount of Rs1.3 billion has been recovered from these persons including businessmen and bankers.

The tax department has attached 15 bank accounts of the super-rich people in Karachi in a single day (Friday). This month, 25 bank accounts have so far been attached. The recovery process of attachment of bank accounts would continue in coming days.

The remaining bank accounts will also be attached after the completion of legal formalities. These persons are not responding to the notices of the FBR and the Commissioner Appeals has confirmed the orders of the tax department.

There was a perception among these persons that recovery notices would not result in actual attachment and recovery of the amount from their bank accounts, officials said.

After the attachment of bank accounts, the next measures would be the attachment of their immovable properties and the possibility of arrest, sources said.

According to the sources, the CVT on foreign assets was due by December 15, 2022. Around 6,000 rich people are required to pay the CVT on foreign assets and nearly 4,000 were required to pay the super tax on high-income earners.

Presently, there is no bar on the government to collect CVT on foreign assets and tax on deemed income basis in Sindh, the sources said. The taxpayers/resident individuals who failed to deposit Capital Value Tax (CVT) on their foreign assets by December 15, 2022, are liable to pay the default surcharge at the rate of 12 percent per annum.

The one percent CVT is applicable on the value of foreign assets of a resident individual where the value of such assets on the last day of the tax year in the aggregate exceeds Rs100 million.

The last date for filing of electronic declaration and payment of the CVT on foreign assets was December 15, 2022.

Under the Capital Value Tax Rules, 2022, the value of foreign assets shall be converted into rupees for the calculation of CVT on foreign assets of resident individuals.

Copyright Business Recorder, 2023

Comments

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Toto Mar 18, 2023 08:55am
What is the government right in collecting tax from some one having property abroad .. it's their money their earnings... Bring the corruption based assets back from abroad that was your challenge
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Bilwani Mar 18, 2023 12:24pm
@Toto, who the he'll will account these haram Khoor beurocrate and politician only those tax payers are account who pay tax just compare the live style of berocrates with their tax payments
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Shiteistan Mar 18, 2023 12:39pm
More money to be made by Tax officials. Hahahaha
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Owais Mar 18, 2023 01:34pm
A very good step by FBR to collect taxes from rich people who have assets abroad.
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Abba ji Mar 18, 2023 03:04pm
FBR, opening new doors for their own benefits.
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Ulgen Mar 18, 2023 05:18pm
Take this money and give it to thieves like Sharifs and Zardaris. I know you will not publish this but I tried
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Nasir Zuberi Mar 18, 2023 06:03pm
This charity should have begun from Nawaz, Shahbaz and Zardari. They have assets abroad and beyond imaginable count. Swiss banks are full of billions of dollars, houses and businesses are separate. Just another opportunity for FBR's teams for making money.
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Xavier B .J. Dsouza Mar 18, 2023 07:09pm
@Nasir Zuberi, well said
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Xavier B .J. Dsouza Mar 18, 2023 07:11pm
Rob the poorest of the poor and fill your corrupted stomachs, your pockets are without holes, and sadly this same I'll gotten wealth is fed to your chuldren, Shame, shame, ▪and no shame
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Alee Mar 18, 2023 10:20pm
State lost financers confidence 3 billions lost worth it's just play Karachi pay tax others are exempted
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Alee Mar 18, 2023 10:21pm
Karachi traders pay tax state dancing and enjoying on it Everyone is exempted by plan
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Qasim Mar 19, 2023 06:19am
@Toto, hahaha.. jumping the ship, may be with some other name, you will be advocating for poor to tax rich and not poor…old useful formula to criticise any govt..keep it up
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KhanRA Mar 19, 2023 12:17pm
Wow 200 people in a country of 220 million must pay tax one time. Wow!
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Shafiq Mar 19, 2023 12:21pm
GoP also needs to rope in the non tax payer agricultural land holders. They have been running around scot free forever.
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Ashhad Mar 19, 2023 12:39pm
How about broadening the tax base .
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Jamal Mar 19, 2023 12:56pm
@Nasir Zuberi, Fully agree.
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Shabbir Hussain Mar 19, 2023 06:24pm
A good step taken by Govt
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E Mar 20, 2023 09:01am
I hope the super rich list contains politicians from all leading parties
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