Taxation laws: government urged to replace four-tier appeal system

The business community has urged upon the government to simplify and ease the appeal system and remove all impediments and complications. They reiterated their demand to replace the existing four-tier appeal system under the taxation laws with two-tier to make the Tribunal a truly independent forum.
The Customs Tribunal and the Appellate Tribunal Inland Revenue should be merged into singular National Tax Tribunal. Like the Services Tribunal this too should work under direct supervision of the Supreme Court.
President of Multan Chamber of Commerce and Industry (MCCI) Fareed Mughis Sheikh said, "An efficient tax judiciary resolves disputes quickly, quashes demands which are not legally sustainable, and thus segregates serious tax demands from frivolous tax demands, as also giving finality to legitimate tax demands".
This in turn ensures that taxpayers cannot resort to dilatory tactics for paying these genuine and legitimate tax demands which have received judicial approval. He said that appeals against its decisions should go directly to the Supreme Court, If steps are taken to merge the Appellate Tribunal Inland Revenue and Customs Tribunal, the new entity should be renamed as National Tax Tribunal. Appeals against the orders of the Tribunal should lie with the Supreme Court alone, he said. He was of the view that Members for Tax Appellate Tribunal should be recruited in the same manner as judges of the High Court. The pay, perquisites and salary structure of the Chairman, members and staff should be at par with the Judge of a High Court, Sessions Judge and staff of the lower judiciary respectively, he opined.
In developing economies like Pakistan, one of the biggest problems is a relatively small tax base and the reluctance of ordinary people to file tax returns and thus submit themselves to scrutiny of their affairs by the tax administration, he said. However, once a taxpayer professes faith in the effectiveness of legal remedies against an unjust tax levy or unjust action of the taxation authorities, he would be more likely to be truthful to the taxation authorities, and willing to accept a reasonable levy of tax, he added.