Islamabad: The Federal Board of Revenue (FBR) has incorporated a new definition of “tax fraud” and established an investigation wing to tackle tax evasion more effectively, as reported on July 25. Read: FBR integrates 9,000 big retailers into POS system
As per details, the updated “tax fraud” definition includes deliberate understatement or underpayment of tax liabilities and overstating claims for tax credits or refunds. This new framework targets practices such as submitting false returns and concealing accurate information. On the other hand, the FBR has created the Tax Fraud Investigation Wing-Inland Revenue. This specialised unit will focus on detecting, analyzing, investigating, and preventing tax fraud. It will be divided into several units, including Fraud Intelligence and Analysis, Fraud Investigation, Legal, Accountants, Digital Forensic and Scene of Crime, and an Administrative Unit.
The revised Federal Excise Act 2005 now stipulates stringent penalties for retailers selling cigarette packs without proper tax stamps or with counterfeit stamps, banderoles, stickers, labels, or barcodes. Such outlets may be sealed in accordance with the new regulations. Additionally, the updated Sales Tax Act gives the FBR the authority to require the integration of electronic invoicing systems with its Computerised System. This initiative is designed to enable real-time reporting of sales and improve transparency and compliance in tax reporting.
