Underinvoicing

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Underinvoicing

The act or practice of stating the price of a good on an invoice as being less than the price actually paid. Underinvoicing occurs if the importer and/or exporter wish to reduce a tariff or if a buyer and/or seller wish to reduce their apparent profits so as to pay less in taxes. See also: Fraud.
References in periodicals archive ?
The Federal Board of Revenue (FBR) is all prepared to introduce a mechanism for the online verification of letters of credit (LCs) with the banks to control money-laundering and under-invoicing.
The minsters agreed to remove discrepancies in the trade data available with the two sides and decided that the electronic data sharing systems would be put in place on both sides before the end of this year which would help to deal with under-invoicing and mis-declaration.
When his attention was drawn to under-invoicing, he said that the government was seriously working to stop it.
PESHAWAR -- The Collectorate of Customs and Taxation Peshawar has effectively checked under-invoicing of goods at border crossings and increased tax collection by 30 per cent after the introduction of Web Based One Customs (WeBOC) system as compared to the tax realization during the past three years.
The tax department charged the firms with under-invoicing the value of products, services or shares offered to parents and, therefore, lowering tax liabilities.
Rabat - The Moroccan weeklies discuss various topics, including the crisis within the government coalition, the fight against cheating in Baccalaureate exams, the 7th World Environmental Education Congress (WEEC-2013) held in Marrakech, and the fight against under-invoicing.
Illegal outflow of capital is often channelled through remittances transferred by such means as Hundi/Hawala system, export under-invoicing, import over-invoicing, and smuggling of precious metals, antiques, etc.
According to the report, "This stylized flow of goods and capital resulting from the under-invoicing of oil exports and related illicit and licit financial flows finds considerable support in recorded FDI [Foreign Direct Investment] flows between Cyprus and Russia.
The local livestock sector is facing increasing unfair competition, ranging from under-invoicing, dumping - selling a product below cost of production-, imports under other tariff items, and bad labeling practices," added Orrego;
An exporter might collude with a foreign importer by under-invoicing to evade tax while an importer might also collude to inflate the price or quantity of goods to increase the amount of the foreign exchange they can obtain, at favourable rates, from the central bank.
Day in and day out, industry steals power and produces output which is not declared, the police collects hafta, illegal construction going on unabated, under-invoicing of exports and imports taking place, hospital waste recycled, question papers leaked, food items adulterated, etc.
In a novel move to curb the under-invoicing, the Ministry of Commerce has proposed imposition of Minimum Export Price (MEP) on 25 exportable items.