KARACHI: Directorate of Internal Audit (DIA), Inland Revenue (IR), Karachi has detected a mega sales tax fraud that provided a financial shock of over Rs 1.2 billion to the national kitty.

According to FIR, the accused person got sales tax registration in 2016 by fraudulent means with the intention to commit such tax fraud. Surprisingly, the firm owned by the accused person neither made any purchases from any other persons/firm during the tax periods of June, July, October and November, 2021 nor showed any carry-forwarded input tax during the same period. However, the firm has made taxable supplies up to over Rs 7.074 billion, which is liable to the sales tax, amounting to Rs 1.2 billion.

Consequently, the accused person has failed to show the trail of such transactions and has not paid due sales tax, which is a violation of the Sales Tax Act 1990 that led the department to blacklist the accused firm. Meanwhile, the Director, DIA Karachi Hina Akram on the instructions of its DG Bakhtiar Muhammad has lodged an FIR against the accused person/firm and raids are being conducted for the arrests.

Copyright Business Recorder, 2022