FBR anti benami, benami bodies cannot arrest tax evaders

• Commercial banks are the biggest obstacle in connecting both databases.
• BAA received a total of 81 reports from Benami Zones.
• 59 cases of benami assets involve an amount of Rs 13.71 billion.

ISLAMABAD: The Anti-Benami Initiative (ABI) and the Benami Adjudicating Authority (BAA) of the Federal Board of Revenue (FBR) are said to remain paralyzed without being able to arrest tax evaders in the country, most of whom belong to the top 1% of those with 22% capital in Pakistan, The news mentionted.

The two bodies, the report said on Friday, have not included these individuals and companies in the tax net.

He added that all those holding multi-billion rupees, in otherwise unexplained assets, have named their assets and wealth against others, but have successfully remained safe, despite the introduction of the Benami Act in 2017, the establishment of the Anti -Benami (ABI). and activation of Benami Judiciary from 2019.

In some cases, the law has been used as a tool for political victimization. After its inception from July 2019 to December 2020, the Benami Benami Authority performed well but later proved to be a non-starter to make a difference.

The accuracy of the misuse of benami could be gauged from the fact that with a Gini coefficient of 0.3, the top 1% of the population owns almost 22% of the total wealth, the bottom 50% only 4% and about 40% of the population lives below the poverty line.

There is no doubt about who is inclined to pay and who actually does not. Does that 1% pay their share of personal income tax according to their income? How do they hide their transactions?

With depreciation and parking of assets and transactions through benami accounts, the comparison of account holders versus return filers shows a huge gap and the volume of these transactions indicates the immense potential of the benami law. Commercial banks are the biggest obstacle in connecting the two databases.

Apart from this, benamidars are widely used for real estate, vehicles, shares and even business transactions to break the supply chain record making it easier for both the originator i.e. the manufacturer or importer to hide the value and the retailer to hide it real income, assets. and amount of accumulated wealth and assets.

When the Benami Act was passed by Parliament, it took almost two years to frame rules to make this Act operational. On July 1, 2019, the Benami Judicial Authority was established with the establishment of three headquarters in Islamabad, Lahore and Karachi, after conducting the initial work for the establishment of any authority and sanctioning new posts and allocation of fiscal resources. However, for the past two years, it could not be done and posts could not materialize.

Subsequently, the Directorate General Anti-Benami Initiative (DG-ABI) was launched to assist the FBR in developing and launching an administrative and supervisory structure to look after three benami zones in Islamabad, Lahore and Karachi and develop and circulate operational manuals , clarifying various provisions of the Benami Transactions (Prohibition) Act, 2017 for guidance and uniformity of action in different Zones.

The Benami Judicial Authority received a total of 81 petitions from Benami Zones and completed 59 cases 24 of the Benami Act 2017. Out of the 59 cases, in 25 cases, benami assets have been seized in 25 of the Act. These 59 cases involve an amount of Rs 13.71 billion, the cost of acquisition. The current market value (for confiscation and auction purposes) is much higher. The said 81 cases include benami properties of all kinds like immovable properties: plots, plots, commercial buildings, houses, etc.

Movable assets: vehicles (including luxury vehicles). Liquid Assets/Cash Equivalent: Benami Shares, Bank A/C (Cash in Bank), Benami Businesses and benami Shares (Goods and Commodities. There are 22 pending cases where most of the cases are in the final stage of disposal and establishment close contact with the NAB and the State Bank of Pakistan in cases involving multilateral interests and knowledge.

This scribe sent a query to the FBR to get a version, but did not receive a response till the filing of this report on Friday evening.