Business firms fined Rs 53.9m for tax evasion
PARSA, AUG 08 – Different business firms in the district have been slapped with a combined fine of Rs 53.9 million by the Inland Revenue Office (IRO) Birgunj for tax evasion. The IRO had found 47 firms of evading tax by making fake Value Added Tax (VAT) bill.
However, the names of the firms that have been penalised have not been made public.
The penalty amount includes Rs 12.3 million for evading income tax, while a large fine of Rs 41.3 million has been slapped for evading VAT and other taxes, the IRO said.
Meanwhile, the office is investigating 20 more firms for possible tax evasion. Of the firms being scrutinised, directors of more than half a dozen businesses have been absconding since the IRO started enquiry against them. Arjun Bhattarai, chief tax officer at the IRO, said that IRO has cancelled their land and property transaction.
Likewise, the IRO has launched probe into 790 business firms whose accounts do not tally with the records of the tax authorities for possible tax evasion.
The IRO put them under scrutiny after the Inland Revenue Department (IRD) sent a list of their names because of the mismatch.
When details about business transactions recorded in the traders’ accounts and the tax authorities’ accounts differ, it is called a mismatch in the tax system. Such problems usually appear when wholesalers and retailers submit differing transaction details to the tax authorities.
The firms under investigation for possible tax evasion include those dealing in noodles, cigarettes, alcohol and LPG. Among the firms being investigated, 590 have annual turnovers of less than Rs 2 million each while 200 firms have annual transactions of more than Rs 2 million each.
The Inland Revenue Department (IRD) has also directed the IRO to carry out the investigation against the suspected firms on regular basis.
Organised crime groups are suspected to be involved in producing fake VAT bills. The IRO said that such groups have also been found registering business firms under the name of people who are innocent and come from deprived communities. Such groups have been found even using the citizenships of the underprivileged people to evade taxes.
For the last six years, there has been rampant mismatch in the tax system.
