Tax evasion telcos to reach out of court settlement with FBR

17 Sep 2012

The five telcos under investigation for tax evasion have reached an agreement with the Federal Board of Revenue (FBR) to settle the disagreement out of court, the Business Recorder reports. Rather than going through the courts the parties will seek an ‘amicable’ close to the issue through the Alternative Dispute Resolution Committee (ADRC). The decision was made during a meeting of the sub-committee of the National Assembly Standing Committee on IT, which also ruled that the matter should be settled before the auction of 3G concessions – overturning an earlier imposition that the telcos in question, National Telecommunications Corporation (NTC), Pakistan Telecommunications Mobile Company Ltd (PTML), Telenor Pakistan, Warid Pakistan and Mobilink (previously known as Pakistan Mobile Communications Ltd, PMCL), would not be permitted to take part in the tender – and that the FBR would not be permitted to use ‘coercive measures’ to retrieve the unpaid tax. The FBR chairman sought to assure foreign investors in the telcos, saying: ‘We will not harass telecom operators.’

Despite the dedication to find an amicable conclusion to the dispute, the National Accountability Bureau (NAB) will continue to investigate criminal elements of the case. As previously reported by CommsUpdate, the NAB is exploring the possibility that officials were bribed to allow exemptions from taxes on interconnection charges.