Govt makes only pal­try re­cov­ery from clo­sure of au­dit cases in Pak­istan

Gulf Times Business - - BUSINESS -

Avail­ing the Pak­istani gov­ern­ment’s amnesty scheme for the clo­sure of au­to­matic au­dit, around 48,214 in­di­vid­u­als de­posited Rs1.04bn un­til Jan­uary 11 by pay­ing penal­ties or higher taxes, it was learnt through knowl­edge­able sources.

The to­tal amount to be de­posited un­der the scheme is likely to be much higher as the Fed­eral Board of Rev­enue (FBR) has al­ready ex­tended the last date to avail the amnesty till Jan­uary 31.

More­over, due to lack­lus­tre re­sponse, around 645,347 non-salary au­dit cases are still pend­ing on the au­dit list, ac­cord­ing to the source.

These in­di­vid­u­als will ei­ther have to avail the scheme or be pro­cessed un­der nor­mal au­dit pro­ce­dures, the source said, adding it is also likely that the last date may be ex­tended fur­ther in or­der to fa­cil­i­tate these in­di­vid­u­als.

The FBR is­sued elec­tronic au- dit no­tices to as many as 1,035,875 late fil­ers since Novem­ber 14 with a dead­line to pro­vide records, doc­u­ments and books of their ac­counts.

These tax­pay­ers had sub­mit­ted their re­turns for tax years 2015, 2016 and 2017 after the dead­lines had passed in the re­spec­tive tax years.

These cases in­cluded 342,314 salaried in­di­vid­u­als and 693,561 non-salaried in­di­vid­u­als in­clud­ing as­so­ci­a­tion of per­sons (AoPs) and com­pa­nies.

The FBR of­fered an amnesty scheme in or­der to abol­ish these cases on the con­di­tion that in­di­vid­u­als ei­ther pay 25% higher taxes than the tax paid with the re­turn or in case, no tax was payable, 2% of the turnover and to file re­vised re­turn by Jan­uary 31.

More­over, the cases of 342,314 salaried in­di­vid­u­als se­lected for au­to­matic au­dit for late fil­ing were set­tled with­out col­lect­ing penalty amount of Rs20,000, a tax of­fi­cial in the FBR con­firmed. He said that the penalty amount col­lected in few cases will be ad­justed against their tax li­a­bil­i­ties in the cur­rent tax year.

For the non-salaried 693,561 in­di­vid­u­als, the FBR had ear­lier given a dead­line un­til De­cem­ber 31 which has now been ex­tended to Jan­uary 31.

The data shows that, of the Rs1.04bn de­posited till Jan­uary 11 un­der sec­tion 214E of the scheme, the pay­ments in­clude a penalty amount of Rs360mn and ap­prox­i­mately Rs675mn un­der other heads.

The city-wise set­tle­ment shows that Karachi has emerged the ma­jor ben­e­fi­ciary of the scheme. Around 13,769 in­di­vid­u­als from the me­trop­o­lis have availed the scheme by de­posit­ing an ad­di­tional amount of Rs324.98mn to close their au­dit cases.

La­hore fol­lowed as the sec­ond ma­jor city to avail the scheme, where as many as 11,965 in­di­vid­u­als closed their au­dit cases by de­posit­ing Rs300.26mn. In the fed­eral cap­i­tal, 3,062 in­di­vid­u­als availed the scheme by pay­ing Rs89.3mn.

In Faisal­abad, 3,619 in­di­vid­u­als paid Rs58.8mn, in Peshawar 1,410 in­di­vid­u­als paid Rs48.7mn where as in Quetta only 508 in­di­vid­u­als opted the scheme by pay­ing Rs9.3mn.

The re­main­ing cases were set­tled in other cities in­clud­ing Ab­bot­tabad, Ba­hawalpur, Gu­jran­wala, Hyderabad, Mul­tan, Rawalpindi, Sahi­wal, Sar­godha, Si­lakot and Sukkur.

Un­der the Fi­nance Sup­ple­men­tary (Amend­ment) Act 2018, non­salaried in­di­vid­u­als, AoPs and com­pa­nies have an op­tion to get their au­dits closed on the pay­ment of ei­ther 25% higher taxes than the tax paid with the re­turn or in case no tax was payable 2% of the turnover and to file re­vised re­turn by De­cem­ber 31.

An amend­ment in in­come tax law was made through Fi­nance Act 2015 by the pre­vi­ous gov­ern­ment that pro­vided for au­to­matic se­lec­tion for au­dit if an in­di­vid­ual had failed to file re­turns by the due date.

The amend­ment was sub­se­quently with­drawn through Fi­nance Act 2018, how­ever, the cases that were au­to­mat­i­cally se­lected un­der the said pro­vi­sion prior to its with­drawal were still to be au­dited.

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