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.
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References in periodicals archive ?
FBR'S decision to raid shops selling smuggled goods is laudable as we are accustomed to consuming foreign goods which are brought either by paying no duty tax, misdeclaration or by under-invoicing. Pakistanis can develop the most sophisticated technologies- nuclear / missiles, etc so can we not produce mobile phones, T.V., Fridge, Air-conditioners and other Electronic products ???
Besides, no data exchange policy was agreed to counter under-invoicing issues.'
Pakistan losses hundred billion rupees under custom duty receipts every year because of rampant practice of Misdeclaration and under-invoicing of imports and exports.
According to a statement issued here on Friday, the Chairman of FBR warned the traders to avoid under-invoicing and misdeclaration on sale and purchase of such items, otherwise strict legal action would be initiated against them.
'Those involved in importing process should not indulge themselves with misdeclaration and under-invoicing or else they will be dealt with strictness', the FBR chairman affirmed while addressing a ceremony here in Islamabad,
Islamabad -- The Federal Board of Revenue on Thursday warned the business community against under-invoicing or misdeclaration of imported goods.
As per the letter, there should be no relaxation in the collection of taxes from any sector, while the government should ensure that the steel products imported in the country are properly duty paid and there should be strong checks on under-invoicing and misdeclarations.
'The government is committed to stopping the under-invoicing for documenting the country's economy,' he said.
In 2016, some of the Indian imports most at risk for high values of import under-invoicing were edible fruits and nuts, sugars, vehicles and cereals.
In his proposals for the upcoming budget aimed at enhancing revenue collection, the FEBR president stressed the need for addressing the key issue of massive under-invoicing and suggested that import value should be fixed in consultation with the industry.
'People are now fed up with under-invoicing, mis-declaration of assets and most of them want to come out of this mess; I believe a lot of people will choose this scheme to avoid any future raids on their business premises,' he said.
The loss in revenue was further exacerbated by under-invoicing and fake certification of origin.