FBR to issue notices to 1,500 owners of properties in UK, UAE

FBR to issue notices to 1,500 owners of properties in UK, UAE

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ISLAMABAD: As the curtain came down on the tax amnesty scheme on July 31, the Federal Board of Revenue (FBR) has decided to issue show cause notices from Monday (tomorrow) to nearly 1,500 Pakistanis who have purchased properties in the United Kingdom and Dubai, top tax officials told Dawn.

The notices will be issued in two phases.

In the first phase, notices will be issued to about 1,000 people who have purchased properties in the UK and receive rent regularly. “The FBR will dispatch these notices from its headquarters,” an official said.

In the second phase, another 500 people who have purchased properties in Dubai will be issued notices. These notices will be dispatched soon after completion of the first phase, the official added.

The notices will be issued to ascertain whether the owners of these properties exist on the country’s tax roll and have declared the same in their income tax returns or not.

The Organisation of Economic Cooperation and Development (OECD) and Britain’s taxation authorities assisted the FBR in collecting information about the properties in that country while in the case of Dubai it was received from tax authorities.

Officials in the FBR believe the notices will help the taxation bodies determine whether the recipients have declared properties in this country or not. “We don’t know exactly how much investment was made in the United Kingdom and Dubai, ” one official said.

The broadening of the FBR’s tax base unit will issue the notices to these individuals. The BTB will do follow-up with the individuals and will compile the data.

The PTI’s prospective finance minister, MNA-elect Asad Umar, told Dawn that his government would rigorously pursue all those Pakistani residents who have not declared their foreign assets. “The FBR will first ascertain whether the property owners are Pakistani residents or not.

Later those Pakistanis who have not declared their properties will face legal consequences,” he said.

Even as an opposition party, the PTI had proposed to the government to crack down on tax evaders, he added.

Asked whether his government will come up with any amnesty scheme, he said no such proposal was under consideration.

An official said FBR had received soft data related to those Pakistanis who are not resident in Britain but have purchased properties there. The FBR has not yet made an assessment of the total market value of these properties, he added.

Pakistan has also become a signatory to the OECD Multilateral Convention, which will start providing access to information about offshore accounts of Pakistani residents next month. This will augment the FBR’s capacity to access offshore financial accounts of Pakistani residents in the signatory countries.

The same procedure would be adopted for Dubai properties, the official said.

On the other hand, the director of intelligence and investigation has collected data of properties, gift schemes, vehicles, etc. The data has already been shared with regional tax offices.

The information will be used for broadening the tax base during the current fiscal year.

According to the FBR, provisional estimates show that 82,848 individuals took advantage of the tax amnesty scheme and they have whitened assets worth Rs2.5 trillion. Of these, 5,363 individuals declared foreign assets while 77,485 declarations were about assets at home.

In the two-month amnesty scheme, FBR received Rs121bn in taxes. Of these, an amount of Rs44bn pertained to foreign assets while Rs77bn to domestic ones.

Published in Dawn, August 5th, 2018

Source: News

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