Karachi, November 19, 2024 – The Federal Board of Revenue (FBR) is preparing to take legal action against banks and other companies for submitting incomplete or inaccurate declarations, a move that underscores the government’s commitment to strengthening compliance within the financial sector.
The FBR’s latest stance comes under the provisions of Section 191A of the Income Tax Ordinance, 2001, which outlines penalties for failure to provide complete and accurate information in tax returns. The tax authority has made it clear that both banking companies and other entities will be subject to prosecution if they fail to meet the required standards for filing tax returns.
According to the FBR, Section 191A specifically addresses the issue of incomplete or blank declarations and documentation. It states that any company, including banks and associations of persons, can face legal consequences if they fail to fully disclose all relevant particulars or information in their tax return. This includes failing to provide a complete declaration of the records kept by the taxpayer, submitting blank or incomplete details, or attaching incomplete annexures, statements, or documents that were required by law.
FBR officials have stated that these violations are considered serious offenses. The penalties for such offenses may include a fine, imprisonment for up to one year, or both, upon conviction. The aim is to ensure that all financial entities, including banks, adhere to the rigorous standards set forth by the tax code to promote transparency and accountability.
The move to prosecute banks and other businesses comes as part of the FBR’s broader efforts to improve tax compliance and close loopholes in the financial reporting system. The FBR has made it clear that it will take stringent actions to enforce the law, as the completeness and accuracy of tax returns are critical for maintaining the integrity of the country’s tax system.
The FBR’s latest directive is expected to have significant implications for the banking sector, as it heightens scrutiny on financial institutions to comply with all regulatory requirements. Banks, which play a central role in the nation’s economy, are being closely monitored to ensure they meet the expectations of the FBR.
As the deadline for submitting tax returns approaches, the FBR has urged all companies, including banks, to double-check their documentation and ensure they meet the standards outlined in Section 191A. The tax authority has also indicated that it will not hesitate to prosecute any entities found in violation of these rules.
This move underscores the FBR’s ongoing efforts to strengthen the country’s tax compliance framework and hold financial entities accountable for their reporting practices.
