Tax Evading Telecom Companies banned from 3G Auction
Senate Sub-Committee on Ministry of Information Technology (MoIT) directed Pakistan Telecom Authority (PTA) to ban all the telecommunication companies involved in tax evasion of Rs 47 billion not to participate in the bidding of 3G auction Spectrum licensees.
The committee issued these directions after recording the prima facie confession of the former Director General Large Taxpayer Unit (LTU) Islamabad and existing Member Inland Revenue Service Ijaz Hussain Shah that he was verbally pressurised by the former Chairman Mumtaz Haider Rizvi and Former Member Administration Raza Baqir to agree and sign letter dated June 30, 2012 on alleged deal between former Chairman Mumtaz Haider Rizvi and telecom companies for allowing Rs 47 billion tax exemption on inter-connect charges to telecommunication companies.
Committee while issuing directions to representatives of the telecommunication companies to appear in the next meeting observed that on making hundreds of billions of rupees annually in Pakistan why they are not contributing due tax to the national exchequer and if they are clean than why they are avoiding handing over their record and invoices.
A leading telecommunication company is earning Rs 80 billion to Rs 85 billion annually and has paid only Rs 2.5 billion tax during last five years. He alleged that telecom companies are involved in massive tax evasion through ””transfer pricing”” by inflating their import of machinery and repatriate huge amounts to off-shore companies in the head of payment of inflated price of their imports and show that they are in loss.
Now it’s time to pay back all the taxes, government will take strict actions by ban of comapnies from 3G auction. Let’s hope our government don’t let these giants get away with taxes.