Six foreign tours companies under tax scanner

New Delhi, Aug 27, 2023

Synopsis
The department sent show cause notices to these companies between June and July. According to an official, hefty tour packages were booked in the name of people who could hardly afford it, by using fake identity. Also these operators were not deducting 5% TDS, which was required for the packages.

The Income tax department is looking into tax evasion by about six companies providing foreign tour packages for under-reporting of income, non-deduction of the prescribed tax and their involvement in remitting money abroad through the hawala racket or unofficial fund transfer.

The department sent show cause notices to these companies between June and July, ET has learnt. "There was gross underreporting of income and also they were using fake names and addresses and identity for booking the package," an official told ET, adding that in some instances a tour package was booked in the name of one person for four consecutive quarters which on closer scrutiny were found out to be fake. The tax evasion instances are from the financial year 2019-2020 onwards. The tax evasion could be to the tune of ₹ 600 crore from all the six operators, officials said.

The official added that hefty tour packages were booked in the name of people who could hardly afford it, by using fake identity. Also these operators were not deducting 5% TDS, which was required for the packages.

[The Economic Times]