Govt to set up valuation offices
Move comes as part of bid to curb under-valuation, under-invoicing
ISLAMABAD:
The federal government has, in principle, decided to set up tax valuation offices in other countries to monitor under-valuation and under-invoicing.
It has also decided to make effective use of bilateral agreements with China, United Arab Emirates (UAE) and Indonesia for exchange of data on exports and imports for this purpose.
However, customs authorities have said that such actions are not enough to keep a check on under-invoicing, pointing out that a high-level political resolve and cooperation must accompany these steps.
According to a document available with The Express Tribune, under-invoicing is being done on a large scale, particularly in trade with neighbouring countries. The document cites the secretary general of the World Customs Organisation as saying most of the under-invoicing is noticed during trade with China and UAE.
Under the agreements, the Federal Board of Revenue (FBR) can exchange and match data of the country’s imports with export figures provided by China, UAE and Indonesia, to find discrepancies.
The document said the electronic exchange of data with these countries was necessary to curb under-invoicing. It added that the issue should be solved on an emergency basis, because it not only inflicts losses on the national economy through lost duties, but also increases the size of the informal economy in the country.
Published in The Express Tribune, March 9th, 2011.
The federal government has, in principle, decided to set up tax valuation offices in other countries to monitor under-valuation and under-invoicing.
It has also decided to make effective use of bilateral agreements with China, United Arab Emirates (UAE) and Indonesia for exchange of data on exports and imports for this purpose.
However, customs authorities have said that such actions are not enough to keep a check on under-invoicing, pointing out that a high-level political resolve and cooperation must accompany these steps.
According to a document available with The Express Tribune, under-invoicing is being done on a large scale, particularly in trade with neighbouring countries. The document cites the secretary general of the World Customs Organisation as saying most of the under-invoicing is noticed during trade with China and UAE.
Under the agreements, the Federal Board of Revenue (FBR) can exchange and match data of the country’s imports with export figures provided by China, UAE and Indonesia, to find discrepancies.
The document said the electronic exchange of data with these countries was necessary to curb under-invoicing. It added that the issue should be solved on an emergency basis, because it not only inflicts losses on the national economy through lost duties, but also increases the size of the informal economy in the country.
Published in The Express Tribune, March 9th, 2011.