FBR IT Wing and PRAL Under Fire for Tax Invoice Fraud Allegations

The Multan Tax Bar Association (MTBA) has raised serious allegations against the Federal Board of Revenue’s (FBR) IT Wing and Pakistan Revenue Automation Limited (PRAL), accusing them of enabling fraudulent sales tax invoice generation. The association has formally addressed the FBR Chairman, urging swift action against those implicated in the malpractice.

According to the MTBA, officials within these entities have been illegally bypassing safeguards on provisional sales tax returns, granting registered taxpayers the ability to alter invoices before resubmitting them. This loophole, they claim, has been exploited by tax evaders to manipulate records and conduct fraudulent transactions.

A previous ruling by the Federal Tax Ombudsman (FTO) on October 3, 2024, in the case of Muhammad Sharif vs. Secretary, Revenue Division, Islamabad, had already exposed collusion between tax authorities and fraudulent entities. Despite this, the MTBA insists that deceptive practices continue unchecked, with regulatory efforts failing to eliminate corruption.

Adding to their concerns, the association highlighted the negative impact of SRO 350 (1)/2024, arguing that it has further complicated compliance for genuine taxpayers. The MTBA has called on the FBR Chairman to tighten oversight on PRAL and the IT Wing, ensuring that system vulnerabilities are not exploited further.

In its formal appeal, the MTBA stressed the urgency of implementing strict reforms to safeguard honest taxpayers and restore public trust in the nation’s tax collection framework. The letter emphasized the need for immediate intervention to prevent further financial irregularities and uphold fiscal integrity.