IRD goes after small, medium taxpayers
KATHMANDU, APR 17 -
The Inland Revenue Department (IRD) has started going after small and medium taxpayers after conducting a major crackdown against big tax delinquents. The IRD has concluded its probe into evasion of value added tax (VAT) by big taxpayers and is currently scrutinizing 560 small and medium taxpayers.
The IRD launched the investigation after uncovering a mismatch in transactions of more than 1,700 taxpayers with an annual turnover of more than Rs 2 million. In the first phase, the department is looking into suspicious accounts of taxpayers whose annual transactions are above Rs 5 million. “We are probing 560 taxpayers in the first phase,” said Tanka Mani Sharma, director general of the IRD.
Sharma said these taxpayers had been put under the scanner because of discrepancies in their accounts. “The amount shown in the seller’s book is greater than the amount recorded in the buyer’s book,” said Sharma. “We have found that the seller sold goods worth Rs 10 million to a particular buyer, but the buyer’s book shows purchases worth only Rs 2 million,” said Sharma.
Though the department has directed inland revenue offices to start an investigation, they have not been able to proceed as defiant taxpayers have not turned up at the tax office to submit their explanations. The department, according to Sharma, is attempting to make contact with the reluctant firms. “Most of the taxpayers have remained out of touch to avoid paying fines,” said Ramsaran Pudashaini, head of Inland Revenue Office 1.
IRD officials said they have found out that most of the firms have submitted fake postal addresses and telephone numbers while registering their firms at the department. “This has further delayed the probe,” said Rammani Dawadi, head of Inland Revenue Office 3.
The IRD had directed big taxpayers to submit details of purchase and sale of goods amounting to more than Rs 100,000 to the Large Taxpayers Office from the last fiscal year. Other taxpayers had been directed to report transactions worth Rs 500,000. The budget has made it mandatory for taxpayers to report dealings worth Rs 100,000 and more.
Finance Ministry spokesperson Rajan Khanal said that the ministry had developed a risk engine to find out the mismatch in the transactions. “VAT evasion by medium and small taxpayers were revealed by the risk engine,” said Khanal. “They are being investigated.”
Source: Kantipur
