IRD Yet to Recover Rs 275 Billion in Tax Arrears

The Inland Revenue Department (IRD) has reported that 330,912 taxpayers still owe Rs 275 billion in tax arrears as of Fiscal Year 2024/25, according to its annual progress report released on Monday.

The report states that taxpayers with pending arrears owe Rs 94.95 billion, while those under administrative review owe Rs 180.10 billion, involving 2,095 taxpayers.

Income tax forms the largest portion of the arrears. The IRD has yet to recover Rs 219.11 billion from 193,620 taxpayers under this category. Likewise, it has yet to collect Rs 48.70 billion in value-added tax (VAT) from 137,253 taxpayers, Rs 4.09 billion in excise duty from 364 taxpayers, and Rs 3.15 billion in other taxes from 1,770 taxpayers.

The IRD also failed to meet several recovery targets in the review year. It recovered only Rs 8.71 billion in income tax arrears against the annual target of Rs 22.76 billion, achieving 38.29 percent of the goal. VAT recovery reached Rs 10.33 billion, or 63.28 percent, against the target of Rs 16.33 billion.

The department adjusted Rs 21.39 billion in income tax arrears out of the Rs 27.38 billion annual target, achieving 78.01 percent. VAT arrears adjustments exceeded the target, with the IRD adjusting Rs 22.29 billion against the target of Rs 18.17 billion, reaching 122.63 percent. -- RSS