About 10,000 taxpaying units are suffering, as 39.73 billion rupees of their sales tax refund claims have not been disbursed by the Sales Tax Refund Collectorate (STRC), Karachi for years. The sales tax refund process is at a standstill, due to which a rapid increase of Rs 37 million in the refunds pending amount has taken place in one month.
Some exporters accused taxmen of STRC asking for huge amounts as bribe for processing their claims. "Only those taxpayers are being entertained who provide sufficient bribe to taxmen in clearing their sales tax refund claims. A large number of genuine refund claimants are suffering by discriminative attitude of the Collectorate staff", they said.
Commenting on the issue, Captain Tariq Subhan, Managing Director, AB Oil Industries (Pvt) limited and representative of Pakistan Vanaspati Manufacturer's Association told Business Recorder on Monday that STRC was working on the motto 'No Rishwat No Refund'.
He expressed disappointment over the non-refund of pending sales tax by the authorities, saying that he had striven hard to resolve the issue through legal channels, but failed. To a question, he said that officials in STRC asked for providing 10 to 20 percent of the total sales tax refund as bribe from claimants for clearing refund claims.
He criticised the bureaucratic approaches including delaying tactics of creating hurdles for businesses, to compel them to give bribe for getting lawful refunds. He cited that malpractice was rampant in an organised way, and subordinate staff was being patronised by high-ranking officials, who were loyal to each other in this dishonest venture. Therefore, internal inquiry committee always fails to identify the corrupt practices in vogue, he maintained.
When asked about the issue Shabbir Ahmed, President, Bedwear Association replied that due to lack of funds in the exchequer, Federal Board of Revenue has failed to effect sales tax refunds within specified deadline.
He said that due to blockage of working capital of taxpayers in STRC, price of the products was being raised with a view to covering the losses by taxpayers. "It will be very difficult to survive in a competitive international market with high products rates causing annulment of the agreement by international buyers and creating negative impact on exports", he said.
He informed that exports of bed wear had declined by 10 percent during current fiscal year, due to high prices of products. According to official sources, a huge number of sales tax refund claims were pending for years due to manipulation in documents of refund claims filed by the taxpayers, which have been a prominent cause of panic for them.
They said that large number of manipulation was detected in suppliers' invoices attached to claimants refund documents, which caused problems in clearance of sales tax refund claims, besides generating excessive burden on concerned taxmen.
They apprised that around 18.18 billion rupees have been debited on account of fresh sales tax refunds against 7,590 refund claims during current fiscal year 2007-08, while about 21.55 billion rupees have been stuck against 1,766 claims for past several years where the clearance process was under way, and it would be disbursed soon.
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