Karachi, January 6, 2025 – The Federal Board of Revenue (FBR) has outlined specific penalties for individuals found guilty of falsifying sales tax records, as per the provisions of the Sales Tax Act, 1990.
These new measures are designed to address the serious issue of fraudulent activities related to sales tax documentation and ensure the integrity of Pakistan’s tax system.
According to the FBR, individuals who engage in any of the following actions will be subject to severe penalties:
• Submitting False Documents: Any person who submits a forged or false document to an Inland Revenue officer will be penalized.
• Altering Sales Tax Records: Those who destroy, alter, mutilate, or falsify records, including sales tax invoices, are liable for penalties.
• Fraudulent Statements and Declarations: Individuals who knowingly or fraudulently make false statements, false declarations, or provide misleading representations, or use forged or falsified documents, will also face penalties.
In all such cases, the FBR has set a penalty amount of either twenty-five thousand rupees or one hundred percent of the amount of tax that has been evaded or is sought to be evaded—whichever is higher. This substantial penalty serves as a deterrent against fraudulent activities in the sales tax sector.
Additionally, the FBR has stressed that those found guilty of such offenses may face further legal consequences. Upon conviction by a Special Judge, the offender could face imprisonment for a term of up to five years if the amount of tax evaded or sought to be evaded is less than one billion rupees. In cases where the amount exceeds one billion rupees, the prison sentence may extend to ten years.
Furthermore, a fine equivalent to the amount of tax evaded or sought to be evaded may be imposed, or both imprisonment and a fine may be applicable. These stringent measures reflect the FBR’s commitment to enforcing compliance and upholding the integrity of the tax system.
The FBR’s latest move to penalize individuals involved in falsifying sales tax records serves as a strong reminder of the severe consequences of tax fraud. It underscores the importance of accurate record-keeping and honesty in all business and tax-related activities.
With these updated regulations, the FBR aims to safeguard the country’s tax system from fraudulent practices and to ensure that all businesses contribute their fair share to the national revenue.