The Federal Tax Ombudsman (FTO) has ordered a nationwide crackdown to track down cybercriminals behind a major sales tax fraud involving fake supplies worth over Rs. 133 million.
According to the FTO’s findings, the scheme was carried out by hacking into a registered taxpayer’s account and using it to file fraudulent sales tax returns. The culprits allegedly manipulated the online filing system, introduced fake transactions through Annexure-C, and created a sales tax liability impact of nearly Rs. 24 million.
How the Fraud Was Discovered
The case surfaced when a 68-year-old commercial importer from Quetta, registered for sales tax since 2008, tried to submit his April 2025 return. Instead, he discovered that his account had been compromised—his password was misused on April 29, and the fraudulent return was filed just two days later.
The FTO noted that the attackers masked their identities using IP addresses and VPNs, making it difficult to trace them without advanced investigation. The Directorate General of Intelligence and Investigation–Inland Revenue has now been tasked with tracking the offenders and determining whether they acted from inside or outside the affected business.
Beneficiaries and Lax Enforcement
Investigations have pointed to M/s Rafi Enterprises, a Quetta-based taxpayer, as a direct beneficiary. The company is accused of knowingly buying fake invoices with no real goods exchanged and no payments made, in violation of the Sales Tax Act.
The FTO criticized the prevailing weak enforcement, which it said has encouraged fraudulent players to deal in so-called “flying invoices” without fear of being caught.
Next Steps Ordered by the FTO
- The Federal Board of Revenue (FBR) must ensure the Commissioner-IR in Quetta initiates legal proceedings under existing SOPs for fake invoice cases.
- An FIR should be registered against all parties proven to be part of the fraud.
- The Directorate General must enhance its capacity to unmask VPN-based cybercriminals.
The FTO stressed that Pakistan’s self-assessment sales tax system is built on trust, and misuse of this system must be met with strong penalties and rigorous prosecution to deter future abuse.
