New tax law proposes jail term, fines for hiding income

The government is proposing amendments to the Income Tax Ordinance that would impose stricter penalties on people found guilty of concealing income or providing false information, particularly when such actions result in a revenue loss of Rs. 500,000 or more.

According to the proposed clause, “Where, in the course of any proceedings under this Ordinance, any person has either in the said proceedings or in any earlier proceedings concealed income or furnished inaccurate particulars of such income and revenue impact of such concealment or furnishing of inaccurate particulars of such income is five hundred thousand rupees or more shall commit an offence punishable on conviction with imprisonment up to two years or with fine or both.”

Acts that fall under the category of concealment or misrepresentation include hiding taxable income, making false claims for expenses that were not actually incurred, or any action outlined in sub-section (1) of section 111.

It is worth noting that this clause was already part of the law, but the latest proposal aims to introduce certain modifications.

Further details about the nature and scope of these changes are expected to emerge in the coming days.