The Federal Board of Revenue (FBR) has directed the Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) to only allow payment of sales tax refund cheques from the Centralised Sales Tax Refund Office (CSTRO) to exporters. Sources told Business Recorder here on Tuesday that the Board has issued instructions to FBR Members Domestic Operations North and South to ensure issuance of cheques to exporters cleared from CSTRO.
The FBR instructions to the Members Domestic Operations North/South is to instruct all RTOs/LTUs in their jurisdictions to provide original cheques not yet sent to the refund claimants so that these cheques could be cancelled, and new ones be issued from CSTRO.
The Board had established a CSTRO at FBR House to implement the new refund system expeditiously. Under the system, the FBR will pay refund in minimum time to the taxpayers without 100 percent verification of the required documents. The refund would be paid on the basis of risk-based profiles of registered persons. The refunds would only be given on selective basis to the taxpayers having good profiles and clean record.
Abrar Ahmad Khan, FBR Member, Strategic Planning and Statistics, would also co-ordinate with Tax Intelligence System (TIS) based automated refunds rejection and the current Sales Tax Automated Refund Repository System (STARR) Scrutiny System to fine-tune risk management criteria based on the refund process. He would be empowered to take feedback from the business community on refund-related issues. He would be engaged in overall supervision of the entire functions of the CSTRO.
Sources said that the FBR has taken a bold step for implementation of the expeditious refund system at national level. In this regard, the board has set up a centralised office for expeditious issuance of sales tax refund, which would be supervised by the Chief of Sales Tax. The provision for establishing CSTRO has been available in the Sales Tax Act, which has now been implemented. The setting up of CSTRO was a major requirement for implementation of the expeditious refund system. Sources said that Abrar has been nominated as overall supervisor of the CSTRO in view of his active role in e-filing, sorting active taxpayers list and refund related issues.