ISLAMABAD: The Federal Board of Revenue (FBR) has decided to utilise credit card data to crackdown on tax evasion by large retail stores. The FBR will also make use of utility bills to evaluate the actual sales of hotels and restaurants.
According to documents available to The Express Tribune, the FBR aims to increase its revenue by taxing the actual sales of retailers. Sources revealed that many retailers do not declare sales charged on credit cards when filing sales tax returns. By accessing credit card data, the FBR will be able to track retailers who understate their sales by excluding credit card transactions.
The utility bills of hotels and restaurants will be also be compared with the sales tax returns filed by these organisation to ascertain whether the correct sales amount has been declared. In case of any discrepancies between the declared revenue and the amount spent on utilities like electricity or gas, a full scale investigation will be started.
A senior official of the FBR commented that these steps were being taken to achieve the ambitious annual tax collection target of Rs1667 billion. It was also learnt that a doubling of withholding tax on electricity bills of commercial consumers was being considered by the FBR.
Published in The Express Tribune, July 27th, 2010.
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