Karachi, January 20, 2025 – In a move to combat sales tax evasion and promote transparency, the Federal Board of Revenue (FBR) has announced policy to reward whistleblowers who provide credible information leading to the detection of tax fraud, evasion, or corruption.
This initiative, outlined under Section 72D of the updated Sales Tax Act, 1990 for the tax year 2025, empowers the FBR to incentivize individuals who assist in uncovering fraudulent activities within the tax system.
Key Provisions of Section 72D
1. Rewards for Whistleblowers: The FBR is authorized to sanction monetary rewards for whistleblowers whose credible information results in the identification of concealed sales tax, tax fraud, or misconduct. This step is expected to encourage individuals to come forward with actionable intelligence.
2. Procedure and Apportionment: The FBR will issue detailed guidelines in the official Gazette, specifying the procedures for claiming rewards and the criteria for apportioning the sanctioned amount. This will ensure a transparent and fair process for whistleblowers.
3. Rejection Criteria: Not every claim will qualify for a reward. Whistleblower claims may be rejected if:
o The provided information lacks value.
o The FBR already possesses the information.
o The details are available in public records.
o No taxes are recovered based on the information provided.
4. Definition of Whistleblower: A whistleblower is defined as an individual who reports tax evasion, concealment, fraud, corruption, or misconduct to a competent authority capable of taking action.
The FBR emphasizes that this policy aims to strengthen its fight against tax evasion and enhance compliance in Pakistan’s tax ecosystem. By incentivizing whistleblowers, the FBR hopes to uncover hidden revenues, streamline sales tax collection, and hold accountable those engaging in tax fraud or corruption.
This initiative is part of the FBR’s broader strategy to bridge revenue gaps and enhance trust within the tax system. With whistleblowers playing a vital role in identifying evasion, the FBR aims to reinforce its efforts to curb tax fraud, contributing to a more robust and transparent taxation framework.
This landmark step reflects the FBR’s commitment to eradicating financial misconduct and ensuring that tax revenues are effectively collected for national development.