The number of sales tax refund claimants under the Expeditious Refund System has shown steep rise as over 100 claims have been filed electronically by the manufacturers-cum-exporters of Lahore.
Sources told Business Recorder here on Tuesday that a team of senior officials of the Federal Board of Revenue (FBR) met the manufacturers-cum-exporters of Lahore to get input on the practical difficulties being faced in filing and processing refund claims electronically.
This is the second meeting between the tax officials and the exporters convened to remove bottlenecks in the electronic refund system. According to sources, out of 100 refund claims, the risk management system has cleared over 30 percent, whereas the remaining claims would be cleared in due course of time.
The FBR officials have assured the exporters that the issue of Mate Receipt (MR) has been resolved to ensure speedy processing of sales tax refunds under the electronic system. The FBR has started obtaining MR directly from shipping lines, which would further process the claims.
The FBR is also considering expansion of the Expeditious Refund System in a systematic manner. It is expected that the system would be expanded at some RTOs where manufacturers-cum-exporters can file the refund claims for the tax period of June. Secondly, the system would be extended to remaining reformed units for the tax period of July. This would ensure implementation of the system in gradual manner.
The manufacturers-cum-exporters have started showing confidence in the system, which is evident from sudden increase in the number of refund claimants. The confirmation of the export of shipment is done by Mate receipt. This receipt is an acknowledgement that the ship-owner has received the export shipment. The exporter has to specify the goods declaration for export indicating Mate Receipt number for processing of refund claims. The FBR is also in the process of directly obtaining the MR from the shipping lines.
The issue of 'carry forward' was also discussed during the meeting and exporters observed that claims have not been processed due to issue of 'carry forward' under the electronic system. The overall response of the manufacturers-cum-exporters was very positive on the new system where refund would be available without manual processing. However, exporters desired that the FBR should practically issue refunds electronically to prove the authenticity of the new system.