FBR finds Karachi marriage halls in Rs9.5 billion tax evasion | Business


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KARACHI: The Federal Board of Revenue (FBR) has detected around Rs9.5 billion worth of tax evasion by marriage halls in the past four years, according to a report published in The News on Tuesday. 

Sources told the publication on Monday that the tax evasion was found in the recently conducted physical survey of banquet/marriage halls by the Inland Revenue department as part of an ongoing broadening of tax base.

The Inland Revenue office visited around 660 marriage halls across the city and inquired them about charges of one function. Charges of marriage halls were variable depending on the location, the sources said.

Also read: FBR Chairman Shabbar Zaidi says has not resigned, but may be unable to continue

The sources added the survey identified that the marriage halls arranged a total of 1,743 functions in one year. The management of marriage halls also collected withholding tax on behalf of the FBR, but failed to deposit the collection in government accounts.

The tax office estimated that the marriage halls would have arranged approximately 6,972 functions in the past four years. 

On the basis of the estimate, the tax office calculated that the tax payable by the owners of marriage halls was Rs9.5 billion. However, the payment made by the marriage halls was only Rs410 million in the last four years.

Also read: FBR identifies 24 bridal dress designers allegedly involved in ‘massive tax evasion’

“Therefore, it is established that an amount of around Rs9.46 billion was evaded by the marriage halls,” an official said, requesting anonymity.

The tax office issued notices to the owners of marriage halls and asked them to make compliance with the legal obligations to clear dues within 15 days.

Notices issued to hospitals, bridal dress designers

Recently, the Regional Tax Office-II Karachi initiated action against the professionals.

The RTO office issued notices to hospitals to provide details of doctors and surgeons working under their management. 

Further, the tax office has also unearthed huge tax evasion by bridal dress designers. The office issue notices to 24 such dress designers to file income tax returns and declare their transactions.

Tax managers have accelerated efforts to mobilise tax revenue to meet the Rs5.23 trillion revenue target of the current fiscal year of 2019/20, which seems ambitious amid stunted economic growth. In the first seven months, the tax revenue amounted to Rs2.4 trillion. The apex tax authority has to rake in Rs2.8 trillion to meet the annual target.

Originally published in

The News

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