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Crackdown on tax evaders leads to 43pc growth in collections

FAISALABAD: Tax authorities in have unearthed a dozen Benami accounts and are going after big sales tax evaders as part of government’s campaign against tax evasion, which has led to a 43 percent growth in tax collections.

The Regional Tax Office (RTO) Faisalabad has posted 43 percent growth in tax collection after it decided to crack down as part of government policy on big tax evaders.

Chaudhry Muhammad Tarique, Chief Commissioner of RTO Faisalabad, said that growth in income tax collection was just 10%, but growth in overall tax receipts came in at 43% for the RTO. T

Faisalabad is Pakistan’s third largest city and is known as the second commercial hub after Karachi. Yet its contribution has historically remained very thin due to the culture of tax dodging, which often leads to tax fraud, such as flying invoices.

There are only 123,445 income tax return filers in Faisalabad, who constitute nearly 8% of total filers in the country. In such an environment, the only option left with the RTO Faisalabad is to broaden the tax base by going after the tax dodgers.

The FBR’s intelligence wing has unearthed 12 Benami accounts; our teams have also uncovered a mega fraud committed by three mills in Jhang, which understated their sales through fake sale and purchase invoices to evade taxes, said the official.

The tax department has also decided to register cases against the people who are involved in tax fraud. The chief commissioner believes that tax recovery can get a boost by establishing an effective and swift accountability mechanism. Over Rs14 billion worth of sales tax and income tax was stuck due to cases filed in courts, Tarique said, adding the RTO had selected 62,000 audit cases and recovered Rs700 million in January 2019.