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News - Afghanistan

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The Ministry of Finance has threatened legal action against a number of small and medium security, communications, printing and airline companies that have evaded taxes "for several years."

The ministry did not disclose the offending companies, but it warned that they would be prosecuted and their names made public if they failed to pay all their taxes before the end of the Afghan fiscal year, coinciding with mid-January 2013.

The ministry spokesman added that the number of tax-evading companies has decreased since last year, but he emphasized that more companies should pay their taxes in a timely manner. The government has recently taken a hard line against offending companies.

 

"Some local companies in the media, printing press, air, security, and telecom sectors that have not cleared their accounts for a few years now. Their licenses have been seized and their penalties are increasing," said Spokesman Waheed Tawhidi.

"They should resolve their problem with the government and pay their taxes. Their names will be made public if they don't pay their taxes," he added.

Tawhidi said the ministry is willing to work with companies to facilitate a gradual payment of their back taxes.

The government is largely dependent on foreign aid for the vast majority of its budget expenditures. With the so-called security and economic transition underway, Afghanistan is attempting to boost government revenues and reduce its aid-dependency.

Cracking down on tax-evading foreign and domestic corporations and boosting customs taxes have been the cornerstones of the government's policy.

The Ministry of Finance has reported improved revenues over the past couple of years, but the revenues are a fraction of government expenditure.

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