FBR strikes Rs2bln stashed in OMC official’s bank account

KARACHI: Federal Board of Revenue (FBR) officials have dug up an amount of Rs2

billion stashed away in the bank account of a senior executive of an oil marketing company (OMC), sources said on Wednesday.

Officials in Large Taxpayers Unit (LTU) Karachi revealed the discovery of the concealed money was made during their ongoing drive of combing the bank accounts of high net worth individuals in search of any financial anomalies.

Tax authorities have launched a comprehensive audit of the accounts of the official to determine the source of transactions, sources added.

Upon inquiring, the sources said, the oil marketing company official told the tax officials that the money in question was transferred to his account under the head of foreign remittances.

It’s noteworthy that the Federal Board of Revenue has no authority to take action or ask any question about the source of transfer if transactions are made under the head of foreign remittances under Section 111(4) of Income Tax Ordinance, 2001.

The tax authorities suspect that the money belonged to the company as sales were suppressed and it transferred the same abroad through the means of money laundering and then brought it back via normal banking channels.

The sources said after a thorough audit, the accused would be further investigated under money laundering charges.

The Large Taxpayers Unit Karachi is currently analysing the bank accounts of high net worth individuals, who are mainly chief executives of major private firms and are registered with the unit.

At a meeting, a month ago in Karachi, Member Inland Revenue Operations had directed the tax offices to identify noncompliant high net worth individuals in their respective jurisdictions.

The sources said the Federal Board of Revenue believed the big firms were engaged in siphoning their profits in order to reduce the tax liabilities.

The companies were also reducing their earnings through transferring huge amount as benefits to their directors, they added.

Recently, several executives of companies visited Large Taxpayers Unit Karachi in response to notices issued for undeclared assets and income.

According to sources, most of the taxpayers had declared their assets by availing recent amnesty scheme.

The Federal Board of Revenue has so far issued around 6,000 notices to high net worth individuals and recovered over Rs245 million as income tax.