ST arrears recovery plan: strict performance benchmarks set for LTUs and RTOs

The Federal Board of Revenue has set strict performance benchmarks for Director Generals of Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) for recovery of billions of rupees sales tax arrears under the ''Sales Tax and Federal Excise Arrears Recovery Plan 2009-10''.
Sources told Business Recorder here on Saturday that the sales tax arrears as on June 30, 2010 should be less then 10 percent in case of LTU and less than 20 percent in case of RTOs. These over ambitious benchmarks have been set for the field formations to ensure recovery of 90 percent sales tax arrears from big companies and corporate entities by June 30, 2010.
However, RTOs have to recover 80 percent of the sales tax arrears from medium taxpayers by June 30, 2010. As sales tax arrears to the tune of billions are accumulated, it seemed to be an impossible task to meet these performance benchmarks for improving sales tax collection in 2009-10.
Another key performance benchmark should be immediate recovery of short paid amount by short filers. The FBR has allowed the field formations to invoke all harsh provisions of the Sales Tax Act for recovery from short-filers. According to Recovery Plan 2009-10, the performance of recovery officer would be adjudged by taking into account following parameters:
The FBR would check the total amount recovered during a month from each category of arrears/defaulters. Secondly, time taken in recovery where recoverable amount has finally been adjudged. The board would also analyse the amount of recovery from cases in litigation where no stay order exists. In case of recovery from non compliant persons who exist on their declared addresses, performance shall be adjudged on two accounts ie (a) effecting recovery (b) Follow up action ensuring that these persons start filing returns regularly;
In case of recovery form non compliant and non existent persons on their declared addresses, performance would be monitored from the number of persons traced and recovery effected, and the recommendations made for Blacklisting of such defaulters, the FBR said. The FBR would also monitor the number of cases referred to Liquidators/Public Officers and instalments recovered on due dates by the LTUs/RTOs.
There is general perception that the departmental representatives (DRs) appear before the Commissioners (Appeals) or Appellate Tribunals without proper preparation with reference to facts/evidence/record of the case or on the legal issues. The Commissioners (Legal) should ensure that the DRs are adequately prepared and are in possession of all relevant records so that the departmental viewpoint is effectively presented before the appellate fora. Appeals, before the Commissioners (Appeals) will be properly represented, preferably by the author of the order, the plan added.