The FBR said that such practices are “highly prevalent in supp | Regulatory Updates Of Pakistan

The FBR said that such practices are “highly prevalent in supply chains and has become an accepted norm”. The cross cheques create financial inefficiency due to clearing period of 1-3 days.

Similarly, cross cheques/open cheques do not carry the “purpose” of the payment or its relationship with the invoice.

“Despite many attempts to increase documentation of supply chains such as withholding tax and further tax, the number of unregistered distributors and retailers remains high whereby sales are suppressed and due income tax is completely avoided”.

In its handout, the FBR did not mention about corrupt practices and the reversal of polices that also contribute to keeping the businesses away from the tax system.

Under the law, the FBR was authorised to open only five years old tax cases. But through the same ordinance, the FBR has created a room to go as back as 20 years to scrutinise the tax record of the people.

The FBR is also engaging SBP to issue necessary instructions to operationalise this important provision of law as well as encourage the banking sector to facilitate the corporate businesses to accomplish digitisation within the stipulated timeframe, the revenue board said.

Source: ExpressTribune
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