FBR set to receive 50,000 cases of Pakistanis owning assets abroad
Credit: The News International
ISLAMABAD: Pakistan’s tax authorities have placed standardised software for receiving first batch of around 50,000 cases of Pakistanis owning assets and bank accounts abroad through automatic exchange portal from Organisation for Economic Cooperation and Development (OECD) with effect from October 1.
Top officials in the Federal Board of Revenue (FBR) told The News on Thursday that they placed software with the grant of UK based Department for International Development (DFID) for receiving information through automatic exchange portal from OECD forum and all required mechanism were in place to use this information against those who would not avail this latest amnesty scheme for declaration of foreign assets.
“We have devised full-fledged campaign for apprising potential non-filers possessing assets abroad,” said the official. For accepting Pakistan into the fold of OECD forum, Islamabad made several commitments to align its tax laws by amending laws through Finance Bill 2017 and 2018, overhauled procedures and mechanism so that exchange of information could be done instantly in secure manner.
When their team showed satisfaction over placed system in Pakistan then they granted permission to operationalise mutual assistance agreement. Through Finance Bill 2018, the FBR has brought foreign jurisdictions into tax net enabling the OECD agreement operational for all tax collection purposes.
The FBR, the official said, intended to launch vigorous campaign after approval of budget 2018-19 from the Parliament the campaign would be run in full swing after installation of caretaker regime. The amnesty scheme will exhaust on June 30, 2018 so the last month and especially last 10 days will be quite crucial for its success.
Ideally, the official said, the amnesty scheme could not be termed good tax policy for any country because it was considered incentive for those who evaded taxes. But this scheme he said, would be quite different from the past because after operationalisation of OECD agreement on taxation, the FBR would be flooded with information about owners of foreign assets and bank account holders and concealment cases would be framed against those who would not avail this last chance. The policy of name and shame will be adopted against tax evaders after June 30 this year, he added.
As the world becomes increasingly globalised and cross-border activities become the norm, tax administrations need to work together to ensure that taxpayers’ pay the right amount of tax to the right jurisdiction.
A key aspect for making tax administrations ready for the challenges of the 21st century is equipping them with the necessary legal, administrative and IT tools for verifying compliance of their taxpayers.
Against that background, the enhanced cooperation between tax authorities through AEOI is crucial in bringing national tax administration in line with the globalised economy.