The Federal Revenue Council ended the demand for a sales tax worth 18.21 billion rupees against Millat Tractors LTD after an investigation began to see the presidential directives.
According to the details, the case is related to the investigation by FBR in the alleged evasion of sales tax by MILAT tractors under Benami laws. The company had defied FBR actions in front of the Federal Tax Secretary, which issued three orders against Millat tractors during 2022-2023. After that, the company and FBR made a total of seven appeals with the president between January 31 and March 2023.
On November 11, 2023, President FBR ordered the appeal against MILAT tractors due to unacceptable sales tax recovery claims that exceed 12 billion rupees related to Benami’s transactions for the 2018-2022 tax period. The compliance report submitted by the great taxpayer unit to the President of Pakistan recently confirmed that a request of 18.21 billion rupees has been established against the company in line with the recommendations of the Federal Tax Secretary.
The report states that the sales tax review for the fiscal year 2021-22 has been completed under Article 25 of the Sales Tax Law, 1990. It highlights an illegal claim for input taxes under Article 8 of the sales tax law that amounted to 169.10 million rupees, with an additional penalty Its 8.45 million rupees. The short payment for sales tax by misuse of SRO.563 (I)/2022 is 1.30 billion rupees, along with an equal penalty of 1.30 billion rupees. The total sales tax was not paid for the progress received from customers in the amount of 214.22 million rupees, with an additional penalty of 10.71 million rupees. Moreover, unacceptable input tax claims due to non -compliance with sections 7 and 8 (1) (C) and 73 of the Sales Tax Law, 1990 amounted to 5.66 billion rupees.
The large taxpayer unit now submitted its report to the Federal Tax Secretary, as it seeks to obtain approval to start tax recovery procedures. With official results now, the case is expected to enter the next stage, which may have significant effects on the company. FBR’s investigation in MILAT tractors is part of a wider effort to form tax evasion and violations in the corporate sector, which enhances the government’s commitment to improving tax compliance and financial transparency.
