Apr 08, 2017

Domestic revenue extortion mafia: Complaints to President Featured

Information has been received that the Inland Revenue Department is shielding an extortion mafia that is intimidating telephone subscribers paying bills of over Rs. 10,000, those purchasing new vehicles and apartments in luxury condominiums and those whose credit card bills exceed 100,000 monthly, threatening them through brokers that they will be fined for evading taxes and extorting money from them.

This racket was revealed through many complaints that had been received by the Presidential Secretariat and upon inquiry, a senior official confirmed it.

When we inquired from the Presidential Secretariat the Senior Official said the complaints had indicated that a Deputy Commissioner General of the Inland Revenue Department and an Assistant Commissioner had initiated this extortion mafia and though many complaints were made to the Commissioner General, she had failed to take any action against the culprits.

Complain in writing:

The official further stated that they had been receiving many complaints in this regard and the President would be notified of this matter and speedy action will be initiated. He however, notified all those who had fallen victim to this scam to inform the Presidential Secretariat about it in writing.

According to further reports, a considerable number of telephone users, persons who purchased vehicles and credit card users had been notified on Inland Revenue letter heads to report to the IR department for investigation.

Threats and extortion:

The extortionists had indicated in the letter that the persons were being summoned by the Tax administration (cooperative small entities and non-cooperative sector) division according to provisions of the 2006 no. 10 Inland Revenue Act 106 (14).

When these persons receiving this letter arrive at the IR department, they are being met by brokers who threaten them saying, If they can spend so much on phone bills, credit cards etc, they should be paying much more as taxes which they have failed to do and as such frighten them saying legal action will be initiated against them. These extortionists then suggest to them that they could avoid being charged by paying a ransom and suggest an amount to these victims.

While many have been summoned in this manner, some state officials too who had fallen prey to this scam had reportedly left the IR office openly condemning these officials. However, these extortionists had managed to cheat many people who had no proper knowledge of the taxation system and force them to pay this ransom.

Unofficial Unit:

Upon inquiry from Inland Revenue Department sources they stated that although it is indicated in this letter that charges are being levelled according to provisions of the 2006 no. 10 Inland Revenue Act 106 (14), in fact it violates the Inland Revenue Act 208.

Similarly, these sources said while a division known as cooperative small entities and non-cooperative sector is mentioned in the letter, there is no such division in the Inland Revenue Department.
They further said throughout history such letters had never been issued by a Deputy Commissioner General and this was the first instance such a letter had been issued, pointing out that there were many flaws in this letter.

Displeasure of telephone companies:

Several telephone companies have called the Inland Revenue Department and expressed their displeasure over this scam accusing certain officials of engaging in this unscrupulous activities in order to fill their pockets and such acts do not fulfil the responsibilities vested in the IR department.

Similarly, they claim that the IR department should have a proper unit that deals with persons evading taxes and this mafia was a unit that was operating beyond the boundaries of the IR department.
They further pointed out that by the Commissioner General keeping silent regarding this matter, it brings great disrepute to the whole IR department and will tarnish the trust and credibility of the institution. It would also have a negative effect on the country’s revenue and bring discredit to the organisation and the government.

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