Pakistani Banks Face Heat from Punjab Excise Department Over Unpaid Vehicle Taxes

The Excise and Taxation Department Punjab issued a stern notice to 26 bank heads in Pakistan for neglecting the payment of token taxes on over 20,000 leased vehicles. According to ETO Admin Khalid Hussain Qasoori, the department warned of severe consequences, including vehicle registration cancellation, 100% fine imposition, and potential seizure and auction of bank properties. The notice highlighted the banks' failure to pay token taxes despite receiving monthly installment payments, including markup, from vehicle lessees.

Punjab Excise Department Informs Pakistani Banks of Tax Nonpayment on Leased Vehicles

LAHORE, Punjab, Pakistan - The Excise and Taxation Department of Punjab has issued a formal notice to 26 bank heads across Pakistan regarding the nonpayment of token taxes on over 20,000 vehicles leased through their institutions.

"The vehicle registration could be cancelled, a 100 percent fine imposed, and bank properties may be seized and auctioned if the taxes remain unpaid," warned Khalid Hussain Qasoori, ETO Admin, in a strongly worded letter sent to the banks.

The department emphasized that banks receive monthly installments for the leased vehicles, including markups, but have persistently failed to pay the Punjab excise's token tax or encourage their customers to do so. Despite repeated notices, meetings, and reminders disseminated via newspaper advertisements, the token tax remains outstanding.

Qasoori stated that if the outstanding taxes, along with a 100 percent fine, are not settled within 14 days, strict measures will be taken. This includes the cancellation of vehicle registrations and the sealing of bank premises.

The department's letter highlights the legal obligation of banks to ensure compliance with tax regulations. It raises concerns about the potential financial and operational consequences for banks that fail to meet their tax obligations, including the loss of assets and disruption of business operations.

The Excise and Taxation Department of Punjab is urging banks to take immediate action to address this matter and avoid the imposition of penalties. The department's determination to enforce tax compliance underscores the government's commitment to ensuring revenue collection and maintaining the integrity of the tax system.

It is expected that the banks will promptly respond to the department's notice and take necessary steps to rectify the situation. The resolution of this matter will contribute to the overall health of the provincial economy and the rule of law.