IRD warns nearly 1,000 companies

It was reported that the Commissioner General Sepalika Chandrasekara has said that about 1,000 companies have been issued notice by the Inland Revenue Department (IRD) to pay up their tax arrears amounting to more than Rs. 160 billion in six months or face seizure of bank accounts and property.

I would like to know from the Commissioner how feasible it is to execute the above decision, if the company resorts to or is faced with any one or more of the following situations:

1. If the bank balance of the company is very low/nil and not substantial enough to recover the tax arrears, or if the money is totally withdrawn before the account is blocked.

2. If the company has taken a huge overdraft and thereby already indebted to the bank

3. If the property has been already mortgaged requiring parate execution

4. If the company deliberately goes into bankruptcy and declares so before seizure by IRD

In the above scenario, what will be the other options available to the IRD to recover tax arrears? Over to the IRD Commissioner for his response.

Mohamed Zahran - Colombo