October 19, 2006	Thursday	Ramazan 25, 1427

ISLAMABAD, Oct 18: Eleven leading banks and financial institutions have not been filing their income tax returns for the last three years in violation of the Income Tax Ordinance 2001.

The Central Board of Revenue in its quarterly report (April-June) of fiscal year 2006 released this week, pointed out the State Bank of Pakistan (SBP), Industrial Development Bank (IDB), Zarai Taraqqiyati Bank, Khyber Bank, Bank of Punjab, KESB, SME Bank and some cooperative banks were among the non-filers.

Surprisingly, the Income Tax Department has not taken any notice of this violation.

The report identified that not every one in the SBP list of banks and financial institutions was income tax return filer. The biggest omission was the SBP itself. Should it file or not needs to be re-assessed.

The report says that there were 11 banks and financial institutions who at one point in time or the other acquired the National Tax Number (NTN) but these were not included in the SBP list of banks and financial institutions.

These include Bank Islamic Pakistan, Dubai Islamic Bank, Emirates Global Islamic Bank, First International Islamic Bank, Franklin Investment Bank Limited, Islamic Investment Bank Limited, Khushhali Bank, Prudential Investment Bank Limited, Rozgar Micro Finance Bank, Security Investment Bank Limited and the First Micro Finance Bank Limited.

The only reason, the report carried for this variation in CBR and SBP list of banks and financial institution was that these institutions apparently had stopped their business which probably that was the reason for their exclusion from the SBP list of banks.

This omission though harmless in nature, did not augur well when compliance ratio was calculated.

Hence there was a need to re-concile Central Board of Revenue database with SBP.