ByKarachi, Pakistan:The Federal Board of Revenue (FBR) has announced plans to take legal action against banks and other companies that fail to provide complete and accurate tax declarations. This initiative highlights the government’s intensified efforts to enhance compliance and accountability within the financial sector.
Acting under Section 191A of the Income Tax Ordinance, 2001, the FBR has warned that companies submitting incomplete or blank details in their tax returns may face severe consequences.
“191A. Prosecution for failure to furnish information in return of income. – Any company including a banking company and an association of persons who –
(a) fails to fully state all the relevant particulars or information as specified in the form of return, including a declaration of the records kept by the taxpayer;
(b) furnishes blank or incomplete particulars or information as specified in the return of income; or
(c) attaches blank or incomplete annexures, statements or documents where such annexures, statements or records were required to be filed, shall commit an offence punishable on conviction with a fine or imprisonment for a term not exceeding one year or both.”
FBR officials emphasized that violations under Section 191A are considered grave offenses. Companies found guilty could face fines, imprisonment for up to one year, or both. The move seeks to promote transparency and integrity in financial reporting, particularly among banks, which play a pivotal role in the national economy.
The decision to pursue legal action aligns with the FBR’s broader strategy to close loopholes in the financial reporting system and improve tax compliance. Incomplete declarations, the FBR argues, undermine the reliability of Pakistan’s tax framework and hinder efforts to maintain fiscal discipline.
As the tax filing deadline approaches, the FBR has urged banks and other entities to thoroughly review their submissions to ensure full compliance with legal requirements. The authority has made it clear that it will not tolerate negligence or deliberate non-compliance, especially from institutions expected to uphold high standards of financial responsibility.
The FBR’s heightened scrutiny is expected to create ripple effects across the banking sector, compelling financial institutions to prioritize the accuracy of their tax filings. By enforcing stringent compliance measures, the tax authority aims to strengthen Pakistan’s financial infrastructure and reduce revenue losses attributed to incomplete or inaccurate declarations.
Industry analysts have noted that while the FBR’s move could increase pressure on financial institutions, it underscores the importance of transparency and adherence to legal obligations. With the threat of prosecution looming, companies are being advised to double-check their documentation and rectify any discrepancies promptly.
This latest directive marks a significant step in the FBR’s ongoing campaign to enhance tax governance, signaling its commitment to enforcing compliance across all sectors of the economy.
