Sources told Business Recorder here on Thursday that the Directorate General of International Taxes (Operations) and its Offshore Commissionarates in field formations, headed by DG Muhammad Ashfaq Ahmad, have shown remarkable performance during the short period since its creation. The DG International Taxes became operational from March 18 for the imposition and recovery of taxes from undisclosed offshore assets and income held by Pakistanis abroad and to interact directly with foreign tax jurisdictions for exchange of information.
The directorate has made recovery of substantial amount of Rs 7.561 billion till April 16, 2019 from the cases of offshore assts with the cooperation of different international tax authorities including UK and UAE and exchange of information under the Organisation for Economic Cooperation and Development (OECD) mechanism.
Latest data revealed that only in one case, Karachi Commissioner Shakeel Kasana of the Directorate General of International Taxes Operations has recovered tax of Rs 685 million from an offshore company under the OECD data exchange. The huge recovery of Rs 685 million has been made by applying normal tax rates at a time when new amnesty scheme has been announced by the government.
Data revealed that the directorate has raised tax demand of Rs 1.070 billion in 560 cases of UAE properties and offshore assets. The agency has recovered an amount of Rs 383 million from the UAE properties cases up to April 16, 2019. The work on the cases of offshore assets held by overseas Pakistanis in UAE is at its peak with the cooperation of the UAE tax authorities, sources said.
The data pertaining to the UK properties revealed that the directorate has raised tax demand of Rs 18 million in 232 cases. The directorate has so far recovered Rs 22 million from the owners of UK properties.
The progress on the investigation of Panama leaks revealed that the directorate has raised tax demand of Rs 12.751 billion in 291 cases and successfully recovered an amount of Rs 6.270 billion during this period.
The directorate has raised tax demand of Rs 508 million in 38 cases of Paradise leaks. The agency is in the process of recovery of cases of Paradise leaks.
Under the OECD exchange of information arrangement, the Directorate General of International Operations has raised tax demand of 1.85 billion involving 212 cases. The directorate has recovered an amount of Rs 889 million in these cases under the OECD arrangement.
All the cases investigated under the OECD mechanism of exchange of information are US$1million and above, sources said. In 20 miscellaneous cases, the directorate is in process of investigation and recovery from offshore assets.
The functions and powers of the Directorate General of International Tax Operations included to receive and send information from other jurisdictions under spontaneous, automatic and on demand exchange of information under exchange of information agreements levy and recover tax by passing an assessment order under section 123(1A) in case of undeclared off-shore assets and incomes; receive, transmit and exchange country by country reports to the jurisdictions that are parties to international agreements with Pakistan and conduct transfer pricing audit in cases selected for such audit by the Director General of International Tax Operations.