FBR Fails to Deduct Billions of Rupees in Withholding Tax

The Federal Board of Revenue (FBR) has failed to deduct Rs. 4.281 billion in withholding tax, causing a substantial loss to the national treasury. This was revealed in the audit report of the Auditor General of Pakistan (AGP). According to the report, during the fiscal year 2020-21, 16 field offices of the FBR and 317 withholding agents did not deduct the due tax while making payments to suppliers, service providers, and contractors. Moreover, the department did not take remedial action for the retrieval of the amount, resulting in a revenue loss of Rs. 4.281 billion. The report states that the lapses were reported to the department from March to November 2021. The department responded that Rs. 55.17 million had been charged but had not yet been recovered. However, legal proceedings for an amount of Rs. 4.226 billion have been initiated but not yet finalized by the department. The AGP has directed the department to recover the charged amount and complete the legal proceedings.