Fake vouchers in use to evade tax

In a typical case of financial crime, tax offices in Kathmandu of late have started encountering rising incidents of taxpayers using fake vouchers to evade taxes. The case first came to government´s notice earlier this month when Land Tax Offices (LTOs) in Kathmandu found mismatch in revenue it received through vouchers and the actual revenue amount deposited in government´s revenue account in Everest Bank Limited (EBL).

The volume of tax evasion through this practice so far is negligible, but concerned officials tipped off that it could just be start of the dangerous trend that could cost the government severely. Worse is, Department of Revenue Investigation also found incidences of entry of voucher receipt data through employees´ usernames, which are unique and protected by password, even while they were not present in the office. "This indicates of either leakage of confidential information or loopholes in the software and system with which Inland Revenue Department (IRD) operates," said a source, adding that such means of revenue evasion was never recorded in 12 year history of revenue administration modernization.

A senior official at Ministry of Finance told myrepublica.com that Department of Revenue Investigation (DRI) has already taken over the case seriously. "Investigations are still on against Chandra Oil Store in Kalopul, Rajesh Trade Concern in Kuleshwar, New Swoyambhu Oil Store in Swayambhu and Makalu Oil Store that were found using fake vouchers to evade the taxes," said the source.

Inland Revenue Department too has recently started an investigation on similar cases that surfaced in recent weeks. It has captured all previous databases as a backup and started monitoring the data entry in the system, tracking when and at what time the data are being entered. Under the existing practice, taxpayers in Kathmandu clear their tax liabilities either directly through check or by depositing the money in the government´s revenue account in EBL and submitting its voucher to the tax office. "It is too early to say wherein lies the problem and who are involved in the anomaly," said the source.

But penetration of tax-evaders into the IRD´s confidential system indicates the involvement of tax officials in the crime. Given that fake revenue vouchers have signatures and seal of the bank employees, officials do not rule out involvement of the bank staffers as well. Officials at both DRI and IRD said they are yet to find out whether such means of tax evasion is practiced only in Kathmandu or has spread in other parts of the country as well.

"Since we have already intensified monitoring the data fed in the system, we will instantly be able to know the fresh attempts to evade taxes," said the source. As for the cases under investigation, officials said they are pushing for early conclusion. MoF has instructed both its departments to take stringent actions against culprits that were found using fake vouchers to evade taxes.
Source:Republica