• Property confiscation & filing legal cases ongoing 

With regard to the reports that the Inland Revenue Department (IRD) has failed to collect Rs. 22 billion of tax revenue and penalties during the past five-and-a-half years, the IRD stressed that it is currently in the process of collecting these arrears and has taken every measure that needs to be taken in this regard.

“It should be clarified that as we are yet to finish collecting these arrears. It is not that we have not taken measures to collect them. We have initiated the necessary processes, and we are continuing them as per the existing systems,” a spokesperson for the IRD told The Daily Morning, adding that collecting these arrears involves a number of steps which take time. 

As part of these measures, the spokesperson explained, steps are being taken to confiscate the properties of and to file cases against those that have not paid taxes, among other actions. The spokesperson further said that court cases have been filed in almost all the cases that require court cases, and that many of these cases are ongoing with the participation of the IRD and the other relevant parties. 

“The IRD is working on collecting all default taxes,” the spokesperson emphasised.

A recent audit report issued by the National Audit Office said that the Government has suffered a loss of approximately Rs. 22 billion in tax arrears and penalties during the past five and a half years due to the IRD’s inefficiency. Issues concerning the Value Added Tax were particularly highlighted in the report.