FBR marks 15 companies for withholding audit

The Federal Board of Revenue has selected 15 multinational companies, including foreign airlines, banks, petroleum companies and media houses for withholding audit for the 2016-17 tax year; it was learnt. According to informed sources, the revenue authority under withholding monitoring and audit strategy for financial 2017-18 has selected the 15 companies. These companies have been included for the third quarter's audit plan.
They said that the companies, which were under the jurisdiction of the Large Taxpayers Unit in Karachi, were among 100 top withholding agents for the 2016-17 tax year. The sources said that the board had also directed the LTU to identify cases other than the 15 cases and that the list of such cases was being sent to the FBR for further action.
According to them, the FBR, which had to maintain 19 percent growth to achieve its revenue target during the first-half of the current fiscal year, was able to attain no more than 17.5 percent growth during this period. They said that the board has decided to punish over 250 officers (12 officers from each unit), including commissioners, additional commissioners, etc across the country.
Sources also said that the FBR had not only taken its worst performing officers to task but is also striving to generate additional revenue to overcome previous shortfall and achieve the third-quarter revenue target. They termed the withholding audit as one of the effective tools to yield substantial revenue collection.
The sources said that the board believed that there were serious discrepancies in the withholding collection and the tax amount reported by these 15 multinational companies during 2016-17 tax year, which is why these companies have been selected for withholding audit.
They said that they had reported Rs 32.056 billion revenue collection for the period, which was bifurcated as Rs 20.297 billion by two banks, Rs 2.74 billion by a petroleum company, Rs 1.767 billion by a fertilizer company, two Gulf airlines reported Rs 1.98 billion tax amount, a shipping line reported its revenue collection as withholding agent to Rs 1.227 billion.
Around Rs 1.614 billion was reported by two insurance companies, a container terminal collected Rs 412.67 million, a media house reported Rs 485.672 million tax amount and a pharmaceutical company gave Rs 802.857 million as withholding collection.