ISLAMABAD – FBR has planned major changes in tax laws to prosecutehigh-net-worth individuals (non-filers) and initiate criminal proceedingsagainst tax evaders in cases where the tax evasion exceeds Rs. 10 million,reports a local newspaper.
The sources quoted by the report said that the proposal is part of a planof the Federal Board of Revenue (FBR) to start the process of disposal oftax litigation for cases with total revenue of approximately Rs. 1.2trillion.
This requires major changes in federal tax laws – the Sales Tax Act, theIncome Tax Ordinance, Federal Excise Act and the Customs Act – for speedyprosecution, said the report.
The government is planning to make it mandatory for tax officials of theFederal Board of Revenue (FBR) to file criminal proceedings againsttaxpayers in cases where the quantum of tax evasion exceeds Rs. 10 million.The unregistered potential taxpayers (non-filers) with the high net worthwill be prosecuted through necessary amendments in the Income Tax Ordinance2001 for the speedy recovery of unpaid taxes from the elite class.
The report quoted a senior tax official saying that section 37A of theSales Tax Act deals with the powers to arrest and prosecute in cases of taxfraud. However, there is no fixed limit of Rs. 10 million to file acriminal case against the tax evader. After the proposed amendments in thetax laws, mandatory criminal proceedings will be done in cases whenever taxevasion exceeds Rs. 10 million.
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For the release of revenue of Rs. 1.2 trillion, expeditious disposal of taxlitigations cases needs to be ensured through an amendment in tax laws andcapacity enhancement of FBR’s Legal Wing.
Sources said that the Ministry of Law and Justice, in consultation withFBR, will formulate necessary proposals for ensuring the fast disposal oftax litigation cases.
A review of tax enforcement laws will be undertaken by the Ministry of Lawin consultation with FBR for proposing penalties and punishments for taxevasion and non-compliance.
