Gold worth Rs 10.86 billion imported by ‘Benami’ taxpayers

May 23, 2014- BR Report



Following high corruption in the taxation department, gold worth Rs 10.86 billion has been imported by ‘Benami’ taxpayers under Entrustment Scheme (ES) in 2013, it is learnt here on Thursday. According to sources, the issue came to surface when the withholding zone of Regional Tax Office (RTO), Karachi raised a tax demand of Rs 2.54 billion against 10 gold importers, who brought yellow metal worth Rs 10.86 billion in the country under the ES during the last fiscal year.

The sources said that misuse of ES by gold importers where bulk quantity of gold/jewellery were imported without fulfilment of gold import conditions required vide Ministry of Commerce SRO 266 (I)/2001 dated May 07, 2001. They said that objective of the SRO 266 (I)/2001 was to broaden the base of Pakistani exports to other countries and provide opportunity to Pakistani artisans to sell jewellery abroad.

The sources however said that the scheme, which allowed 80 percent of the value of jewellery set against duty-free import of gold within six months, was being misused with no benefit to the country. Analysing the records of gold imports for last fiscal year revealed that gold worth Rs 10.86 billion was imported without paying normal import tariffs and duties under the said SRO.

However, the export data has depicted different picture, showing that gold worth Rs 152.45 million had only been exported during the said period. They said that these gold exporters, who availed tax benefits under the ES in 2013, had failed to contribute in the national exchequer by exporting value-added yellow metal in stipulated period of six months.

Therefore, these exporters are liable to pay duty and taxes as per prescribed rates on imported gold along with penalty at the rate of 5 per cent of duty and taxes for first month and at the rate of 10 per cent for subsequent months, the sources said. Replying to a question, sources said that although the tax demand of Rs 2.45 billion had been raised against gold imports of Rs 10.86 billion by the withholding zone of RTO, Karachi, field formation was unable to recover the outstanding levy as all 10 exporters were Benami taxpayers.

Moreover, they said that the withholding zone of RTO, Karachi, had also sent a letter to the Preventive Collectorate to get more information about these exporters. They said the department had also requested the Preventive Collectorate to recover outstanding levy from these exporters in case of more gold consignments were in the process of clearance on their names.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More