Meanwhile, the Internal Revenue Department, in a preliminary investigation of account books at Progress Education, found that it owed the government Rs 12,500,000 in taxes, and has ordered it to immediately clear Rs 9,400,000.
The department has also seized the books at Saleways Department Store at Jawalakhel, according to a department source.
The IROs have seized the accounts of over a dozen schools and colleges, an additional dozen educational consultancies and more than two dozen restaurants and trading firms, after investigations showed that those entities had cooked their books while submitting statements to the tax offices.
IRO sector 1 in Kathmandu has seized the accounts of seven private schools and colleges, said a senior revenue official. Likewise, investigation teams have taken control over the books of six trading firms, four educational consultancies and about half a dozen restaurants and bars.
“All those entities showed zero income in their assessments submitted to the tax office, whereas their account books showed turnover running into millions,” said Shishir Kumar Dhungana, chief of IRO -1.
The office is yet to finalize their actual tax liabilities. But officials investigating the cases said preliminary investigation has revealed that each school and college has dodged tax of at least one million rupee.
Revenue dodged by other entities is also estimated to be close to one million.
Likewise, IRO sector 2 is also investigating the books it seized very recently from six trading firms. It also conducted stock verification at some dozen firms, and ascertained revenue leakage of around Rs 6 million.
As the fiscal year approaches its end, the government has mobilized investigations teams widely across the market to tighten up revenue leakage.
Three IROs in Kathmandu are currently mobilizing six different investigation teams each. Investigation teams from the Inland Revenue Department (IRD) also raided about half a dozen entities this week and took control of their books for reassessing their tax liability.
The IROs have divided their investigation teams under three categories. The first is mainly for monitoring the enforcement of VAT bills and cross-checking tax compliance at the retail level. The second is for conducting investigations, while the third is for launching raids and taking control of the account books of suspected tax evaders.
Tax offices geared up their action mainly after the Finance Ministry issued strict directives to intensify crackdowns on tax evaders, especially since revenue growth shrank marginally in the 11th month of the current fiscal year.
Despite the shrinking, overall revenue collection has exceeded target by 4 percent. The government has set a revenue target of Rs 141.72 billion in the current fiscal year ending mid-July 2009.
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