Telenor to get a Rs. 20 Million Surcharge by FBR for Short Deduction of Taxes

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Telenor to get a Rs. 20 Million Surcharge by FBR for Short Deduction of Taxes
Telenor to get a Rs. 20 Million Surcharge by FBR for Short Deduction of Taxes

Telenor to get a Rs. 20 Million Surcharge by FBR for Short Deduction of Taxes. In a country where most of the citizens including political and governing bodies always try to avoid paying taxes then why companies should bother to pay it completely? As, recently FBR sent its second notice to Telenor and  it has imposed a Rs. 20 million penalty for short deduction of withholding taxes from customers living in FATA.

It is important to mention here that the penalty is in addition to Rs. 267 million withholding taxes that Telenor apparently didn’t collect from customers based on operator’s previous consideration with FBR and precedence of tax omission for people living in FATA.

On the other hand, Federal Board of Revenue says that Telenor should have subtracted taxes from FATA and should have submitted the same to the government.

An FBR official in a senate standing committee meeting today said that,

 “We can confirm that Telenor didn’t collect taxes from FATA and we sent them a notice to explain the short-deduction”

“Since the taxpayer could not justify the non-deduction of tax, therefore an order has been recently passed as per the Income Tax Ordinance, 2001 creating a demand of Rs.287 million (including the default surcharge)”, added the FBR official.

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However, in response Telenor has decided to challenge the notice before “Commissioner Appeals”.

Chief Corporate Affairs Officer of Telenor Pakistan, Kamal Ahmed said in a response to the matter,

“We disagreed with FBR’s first notice and responded with verifiable details of tax payments provided during the audit and requested the withdrawal of this notice. FBR has re-raised the same demand with additional surcharge; however we are contesting this demand before the Commissioner Appeals as we can confidently claim to have carried out all our statutory fiscal obligations.”

One operator that deducts taxes from FATA is primarily due to its technical restriction as its structure doesn’t permit it to geographically abolish tax collection for some regions.

Furthermore, as this case is precedence so there’s a Peshawar High Court verdict that undoubtedly states that no taxes are valid and applicable in FATA.

In addition, it is anticipated that Telenor will go into lawsuit with FBR and the subject is going to be resolute by the court now.

According to Telenor the company is committed to meeting all lawful obligations. It always tries to carry out its operations in firm accord with the laws of Pakistan while maintaining the highest standards of corporate moral values and reliability.

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