LAHORE: The Federal Board of Revenue (FBR) has introduced amendments to the Sales Tax Act to harmonise it with income tax law under the Finance Act, 2024, tax experts said.
According to experts, seven definitions have been amended in the Sales Tax Act through the Finance Act 2024. They said the definition section has changed the definition of time of supply.
They added that the advance tax had been exempted in the Finance Act 2021, revised in the present Finance Act.
FBR fails to achieve Rs9.4trn collection target
Some experts pointed out that a crucial change has been made to the sections dealing with ‘tax fraud’ in the sales tax. Under the new scheme of things, the onus of proof has been shifted to the taxpayer, who has not committed tax fraud from now on.
On the filing of sales tax returns, they said, a new subsection has been added to empower the assessing officer to require the taxpayer to produce a record of the last 15 years, mostly in tax fraud cases. They said the department would take every action as a fraud on the part of the taxpayer unless he proves otherwise. Also, a tax fraud investigation wing would also be set up to deal with all such matters, they said, adding that the monetary limit has also been extended in case prosecution against a tax fraud, which means anyone involved in tax fraud would not be eligible for bail. Anyone committing tax fraud over Rs1 billion would be imprisoned for 10 years and those with less than Rs1 billion fraud would be incarcerated for five years. Major offences have been made non-bailable under the new scheme of things.
The changes have also introduced the concept of licensing to the agents involved in electronic invoicing integration to determine their liability in case of any future controversy.
So far, as the section related to adjudication is concerned, section 11 has been omitted, while four new subsections have been added for the best judgment.
The Finance Act has also empowered the chief commissioner to hear appeals in cases of blacklisting proceedings of any taxpayer. The Chief Commissioner would also be authorized to examine the tax record of any taxpayer to decide case of tax fraud. Earlier, they said, the commissioner’s order was appealable before the tribunal. However, this provision has been abolished in case of blacklisting a taxpayer.
The sources said the concept of auditing has also been changed in the sales tax. Earlier, a desk officer was authorized to carry out desk audits. However, the commissioner will issue notice to taxpayers from now on in case an audit is required. The Board has also defined risk parameters, and no audit will be carried out merely for verification purposes.
Copyright Business Recorder, 2024
Comments
Comments are closed.