FBR Under Scrutiny: Senate Panel Seeks Records on Rs. 1,120 Billion FATA Tax Exemption Case

A Senate subcommittee investigating the alleged misuse of tax exemptions for the erstwhile FATA/PATA regions has once again directed the Federal Board of Revenue (FBR) to submit complete records regarding imports valued at Rs. 1,120.66 billion. The committee, chaired by Senator Saifullah Abro, is examining potential tax liabilities and revenue losses stemming from the exemption regime.

According to figures presented to the panel, consumption certificates have been provided for only Rs. 389.86 billion worth of imports, leaving an unreconciled gap of Rs. 730.79 billion. Sector-wise breakdown revealed apparent discrepancies of Rs. 148.248 billion in steel, Rs. 146.95 billion in textiles, Rs. 100.88 billion in food, and Rs. 76.48 billion in ghee and oil. The committee has called for a transaction-wise reconciliation to determine the actual tax liability.

The Federal Investigation Agency (FIA) informed the committee that it has issued 512 notices to companies as part of its probe. Only 19 companies appeared with partial records, while over 100 notices were returned undelivered. The FIA stated that the matter is sub judice and that proceedings remain investigative, with possible corruption, abuse of authority, and wrongful release of securities also being examined.

A discrepancy emerged during the meeting when FBR representatives claimed they had not received any formal court notice, while FIA officials said their legal adviser had received the relevant court order. Senator Abro expressed concern over the lack of coordination and questioned the FBR's reluctance to share records with Parliament, citing Article 66 of the Constitution.

The committee also reviewed consumption certificates and payments released against them. It was noted that out of 223 companies, certificates were expected for 60 companies. Particular attention was drawn to 20 certificates involving approximately Rs. 64 billion, and the FBR was directed to provide complete records and justification. The chairman stressed that parliamentary oversight must be respected and that every rupee legally due must be recovered.

The documents are to be reviewed at an in-camera session on November 16, as the subcommittee seeks to establish how much of the imported goods were properly accounted for under the tax exemption arrangement.