The Federal Board of Revenue (FBR) has assured Punjab Revenue Authority (PRA) that it will release Rs 1.8 billion on account of input tax adjustment to the province, saying it will also issue time schedules for provinces to resolve reconciliation issues of tax adjustments during the last five years.
Sources told Business Recorder that Chairperson FBR/Secretary Revenue Division Rukhsana Yasmin and Chairman PRA Dr Raheel Siddiqui held a very positive one-on-one meeting at the FBR House on Friday. Both the sides agreed to take appropriate steps for speedy reconciliation of data pertaining to the input tax adjustment.
Sources said that the meeting was successful and almost resolved all issues relating to the reconciliation of the input tax adjustment between FBR and PRA. The manual reconciliation of data of the past years would also be done with the assistance of the FBR. According to the sources, tax authorities have principally agreed to release Rs 1.8 billion amount of input tax adjustment to the PRA. The second major issue has also been resolved that the FBR will issue schedules for the provinces to work out manual input tax adjustments for the last five years, officials added.
The PRA wanted that the FBR should use STIRVE software, a real-time sales tax invoice verification system for reconciliation purposes. The rationalization of the input/output tax adjustment between the FBR and the provincial revenue authorities/boards has been pending since 2013. This is in spite of the fact that a joint committee of the FBR and provincial revenue authorities/boards has been set up to explore the possibility of a single portal/single sales tax return for taxpayers registered with the FBR as well as provinces to avoid filing of multiple returns by taxpayers.
The objective was to take the viewpoint of FBR/provinces on a single portal/single return to facilitate taxpayers as well as to ensure transparency in input tax adjustment. Presently, taxpayers have to get registered in multiple jurisdictions and have to file multiple returns. There is also the possibility of a claim of the same input tax from multiple jurisdictions because of lack of checks on such adjustments. Single portal would ensure that taxpayers are facilitated by uploading data on a single portal. The portal would also ensure quick reconciliation of cross-adjustment of input tax.
Sources further revealed that FBR has signed MoUs with three provincial authorities, ie, PRA, KPRA and SRB for reconciliation of cross-adjustments of input tax and payment of net amount by the beneficiary agency to the other. However, the Balochistan Revenue Authority (BRA) still has not entered into any agreement with the FBR on the issue.
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