Islamabad: The Federal Board of Revenue’s (FBR) tax office in Sargodha, unearthing the details, has recently exposed withholding tax (WHT) evasion in Punjab’s property registration sector, as reported by a source on December 18.
According to the details, the regional tax office conducted an electronic audit, revealing a staggering evasion of withholding taxes on property transactions in the billions. This amount was collected but never deposited into the national treasury, leading to substantial revenue loss. The Regional Tax Office (RTO) in Sargodha, entrusted with the audit, successfully recovered over PKR 388 million from the defaulters, shedding light on the extent of the financial irregularities.
The elaborate scheme involved a well-organised group comprising property registrars, revenue officers, and lawyers in Punjab. Their failure to deposit the deducted withholding taxes from immovable property transactions contributed to a substantial loss in revenue.
The digital audit brought to light the utilisation of fake challans in collaboration with buyers and sellers, further contributing to the massive revenue loss. This revelation comes at a time when withholding tax collection from the sale of immovable properties has witnessed an unprecedented surge, recording a remarkable 340.5% increase during the fiscal year 2022-23 compared to the previous year. The collection soared to PKR 70.326 billion in 2022-23, a significant jump from Rs 15.966 billion in 2021-22.
The investigation was spearheaded by Chief Commissioner Dr Faheem Muhammad and Withholding Zone Commissioner Raja Babar Nawaz, revealing that property registrars, in collaboration with sub-registrar offices, lawyers, and regional revenue officers, were involved in committing fraud, causing a loss of billions in revenue. The audit identified all 17 sub-registrar offices as participants in retaining the deducted withholding taxes on immovable properties.
As a graduate in English Literature, Zohaib believes that words are not just a mere figment of imagination. It takes wisdom to be good at them. Following this reason, he is pursuing his career as Public Relations and Content Specialist at Zameen.com.
