FBR will send tax notices to 600-700 potential tax evaders in UK

ISLAMABAD: After expiry of tax amnesty scheme that had failed to lure owners of offshore assets abroad in a big way, the Federal Board of Revenue (FBR) has decided dispatching tax notices to 600-700 individuals having rental income from possessing expensive properties at UK in a bid to proceed against potential tax evaders.

The UK tax authorities have shared full details of Pakistanis owning properties and earning rental incomes with the FBR as they provided us their addresses with telephone numbers.

“We have worked out details and will start sending out tax notices very soon. In this format of information, no one can hide himself or herself from the radar of FBR,” top FBR officials confided to The News here on Friday.

The FBR has obtained information from UK Tax authorities with the assistance of Organisation of Economic Cooperation and Development (OECD) as exchange of information became operational and now the FBR was all set to move long arm of law for penalizing tax evaders in a big way.

“The incoming PTI led government wants to increase tax collection from Rs 4000 to Rs 8000 billion so the FBR is also making preparation to go ahead with the policy of name and shame for tax evaders but it will also depend that how much the government provides autonomy to the tax collection machinery,” said the FBR officials.

All concerned Large Taxpayers Units (LTUs) and Regional Taxpayers Offices (RTOs) have been instructed to send tax notices to these 600 to 700 individuals mainly belonging to Karachi, Lahore, Islamabad and other parts of the country to ascertain whether they were return filers or not. If they will be found non-filers then the law of the land will move against them, said the sources.

The official said that the FBR developed centralized system to monitor progress on these dispatched tax notices in a bid to remove element of harassment. “We will track down progress on these tax notices while sitting at our offices in Islamabad,” said the official sources.

“We have obtained information of hundreds of Pakistanis owning immoveable properties in the UK,” said the official. Under confidentiality clauses, the FBR cannot disclose exact numbers and details of the obtained information from the UK Tax authorities under the OECD mechanism. However, the sources said if confidentiality clauses are breached, then the FBR would not be able to get any future information so the tax authorities have ensured security and foolproof arrangements to protect the information from any leaks.

The FBR has placed standardised software for receiving first batch of thousands of cases of Pakistanis through automatic exchange portal from the Organisation for Economic Cooperation and Development (OECD) to seek financial data of assets and bank accounts abroad with effect from September 1, 2018. The FBR has placed software with the grant of UK based Department for International Development (DFID) for receiving information through automatic exchange portal from OECD forum and all the required mechanisms were in place to use the information against those who would not avail the amnesty scheme for declaration of foreign assets.

The FBR had told this scribe that total 82848 declarants whitened assets valuing Rs2.5 trillion through domestic and foreign tax amnesty schemes as 5363 availed foreign tax amnesty and 77485 got domestic amnesty.

Pakistan also received $366 million so far from abroad as cash on account of offshore tax amnesty scheme. The FBR so far collected Rs121 billion from this amnesty scheme including Rs44 billion on foreign amnesty and Rs77 billion on domestic amnesty. It is expected that this collection will go up by Rs5 to 6 billion as the SBP branch at New York has not shared final details with the FBR.