FBR “May Disclose Information” on Politically Exposed Persons Under (Supplementary) Finance Bill, 2021 – Business

The government has moved to remove restrictions on the Federal Board of Revenue (FBR) not to disclose information about politically exposed persons, including senior officials, under the 2021 (Supplementary) Finance Bill.

Thanks to the 2021 (additional) finance bill, the RBF was empowered to disclose information on politically exposed persons. The amendment was supported whereby details of senior officials and public officials in BPS-17 and above, their spouses, children or Benamidars, are not excluded from disclosure by section 216 (1) of the Income Tax Ordinance. , 2001.

Explaining the 2021 (Supplementary) Finance Bill, Ashfaq Tola, a leading tax expert, explained the proposed amendment to Article 216 of the Income Tax Ordinance 2001.

Section 216 of the ITO governs the disclosure of information by a public servant.

Subsection 216 (3) provides for situations in which the disclosure of information cannot be excluded by subsection 216 (1).

The bill proposes an amendment that the contact details of senior officials and public officials of BPS-17 and above, their spouses, children or Benamidars, or any person in relation to whom the aforementioned persons are beneficial owners, will not be prohibited from disclosure by Article 216 (1).

The bill further proposes a conditional clause (which may also be referred to as a “carve-out”) whereby persons who have been excluded under section 5 (m) (iv) of the National Accountability Order Office, 1999 will be excluded from the above amendment. .

The explanation proposed by the bill links the meaning of “high-level public official” to the definition of politically exposed persons (“PEPs”) mentioned in a rule, regulation, decree or in any law currently in force. .

PEP has been defined under Regulation 2 (m) of the National Savings Regulation (AML and CFT), 2020 as “any individual who is or has been in charge of a prominent public service in Pakistan, in a foreign country or in an international organization, and includes, but is not limited to: (i) Heads of State, Heads of Government, Ministers and Deputy Ministers or Deputy Ministers, regardless of their name ; (ii) members of Parliament or of the Provincial Assembly; (iii) judges of supreme courts, constitutional courts or any judicial body whose decisions are not subject to appeal, except in exceptional circumstances; (iv) government employees of BPS21 or equivalent and above; (v) ambassadors; (vi) military officers with the rank of lieutenant-general or above and its corresponding rank in other services; (vii) directors and members of the board of directors or equivalent function of an international organization; (viii) members of the governing bodies of political parties; and (ix) board members or equivalent function in companies, departments or bodies that are owned or controlled by the state, Tola added.

The story was originally published in Business Recorder on January 2, 2022.

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