Clothing brand sealed by FBR for alleged tax fraud

The Federal Board of Revenue (FBR), through its Regional Tax Office (RTO) II, has sealed multiple outlets and offices of the Western clothing brand Sowears over alleged tax evasion exceeding Rs100 million.

According to FBR officials, Sowears has not integrated its Point of Sale (PoS) system with FBR's centralised system since 2018, following a thorough examination of the business's financial operations.

The non-compliance concealed taxable income,, costing the national exchequer money.

At least four to five major brand stores in Karachi were sealed by FBR, including those in Saima Mall, Lucky One Mall, Dolmen Mall, Ocean Mall, and Hyderi Market. 

Additionally, the brand's factory in the SITE industrial area was raided, and digital evidence and business records were seized.

The investigation also revealed that Sowears had reportedly been conducting undisclosed business in the United States and the United Arab Emirates. 

The company's Pakistani income statements made no mention of these transactions, which were reportedly handled via courier services. 

The FBR is concerned about potential money laundering since it believes that these overseas transactions may include the use of fake companies and illicit bank accounts.

The inquiry is being conducted under the Income Tax Ordinance and other relevant laws, and further investigation is ongoing.