FBR appoints two committees to probe scams

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ISLAMABAD: In response to corruption allegations having been raised against the tax department, the Federal Board of Revenue (FBR) has appointed two inquiry committees to probe multibillion rupees refund scams and the loss of up to Rs1,190 million in revenues, it is learnt. Chairman FBR Ali Arshad Hakeem has taken note of media reports regarding massive refunds scams and handed over a note written by Additional Commissioner Large Taxpayer Unit (LTU) Karachi, Sajjad Akbar Khan. In the letter Khan said under oath that a massive fake refunds mafia was playing havoc with the national exchequer in all three Regional Taxpayer Offices (RTO-1, II and III) in Karachi. RTO-II was labelled the hub of fake input invoices. The business of refunds in the steel and chemicals sector was thriving here.

“Yes, we have constituted two inquiry committees headed by FBR’s Member Legal Aqil Usman Mirza and Member Training Yasmin Saud to probe Khan’s letter on fake refunds scams and involved loss of Rs1,190 million in revenues by giving relief to one known fertiliser company,” official sources confirmed on Monday.

Sources in the FBR said that the top notches are serious about rooting out corrupt practices in the tax machinery as the Federal Tax Ombudsman could take required steps by summoning the top hierarchy. Moreover, the FBR placed the Intelligence and Investigation wing of the IRS by empowering them to issue red alerts to stop suspicious refunds. Some corrupt elements within the FBR were upset at this arrangement. They made desperate efforts in recent weeks to dislodge this mechanism but their efforts proved futile.

The FBR’s data shows that fake input adjustments and illegal refunds caused Rs537 billion in losses to the national exchequer and in the first five months of the fiscal year, the revenue stood at Rs200 to Rs250 billion. The FBR’s top notches reached the conclusion that this violation could destroy the taxation system of the country and required immediate hi-tech solutions.

On the incentive given to the fertiliser company, FBR’s Commissioner Inland Revenue (Appeals-II) Karachi, Bashrat Ahmed Qureshi, sent a message to Hakeem, alleging that a senior FBR official had given incentive to two companies of the same group in the fertiliser sector that caused a loss of Rs690 million and Rs500 million to the national exchequer.

Sources said that the same individual had allegedly provided unlawful benefits to one of the companies of the same fertiliser plant when he was serving as Commissioner Appeals in Multan and this record was lying in the files of the FBR.

In another case of the same group of Fertiliser Company, this officer raised a non issue that resulted in benefits being awarded to the company. “Now a probe has been ordered that will help resolve the situation,” concluded the sources.


Courtesy: The News

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