Category: Taxation

Islamabad, August 9, 2025 – The Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to investigate IP addresses linked to a high-profile sales tax fraud case involving fake invoices worth millions.

According to the complaint, a 68-year-old commercial importer, registered for sales tax since August 2008, discovered the fraud while attempting to file his April 2025 return. Cybercriminals allegedly hacked his credentials, altered official records, and filed a falsified sales tax return showing fake supplies of Rs. 133.125 million, leading to a GST impact of Rs. 23.962 million. The transactions were traced to Rafi Enterprises, a taxpayer in RTO Quetta.

Investigators found that multiple IP addresses—originating from Battagram, Islamabad, and Frankfurt—were used to execute the fraud, likely via VPN services to mask identities. Despite repeated notices, internet providers have not disclosed subscriber details. The FTO emphasized that tracking such sophisticated cybercrime requires advanced technical capabilities currently lacking in FBR and PRAL.

The inquiry concluded that the beneficiary knowingly purchased fake invoices to evade sales tax, violating Section 73 of the Sales Tax Act. The FTO urged FBR to initiate FIRs and prosecute all parties involved in the fraud under relevant laws, as well as to strengthen monitoring systems to prevent future misuse of taxpayer credentials.