The Federal Board of Revenue (FBR) has expressed serious concern over non-payment of nearly Rs 8.8 billion sales tax refund to exporters by the special task force of Regional Tax Office (RTO) Karachi. The FBR Domestic Operations (South) Wing has written a letter to the head of Task Force Team No 1 about delay in refund payment at the RTO Karachi.
Sources told Business Recorder here on Friday that the Board had constituted a task force to expedite clearance of the sales tax and federal excise refund stuck up in the field formations, which is considerably delaying payment of admissible refund claims. The Task Force was set up in Karachi, Lahore and Faisalabad to clear pending refunds on top priority.
The Board is gradually reviewing the progress of the Task Force on daily basis to ensure speedy payment of refund to the exporters. The latest letter of the FBR Member Domestic Operations South to the RTO Karachi said that the FBR was disappointed on the current pace of refund payment to the Karachi-based exporters.
According to the Board's letter (cases of deferred refund claims), the FBR said that the refund amounting to Rs 8,866.6 million in 26,515 cases was still pending (as on November 11, 2010) whereas as per September 24, 2010 decision of the Board-in-Council the Task Force had to issue all refunds by November 20, 2010.
Though daily performance reports of the Team No 1 pertaining to November 12-20 are still awaited, the RTO failed to achieve the set target. The Board was of the firm opinion that the Task Force Team No 1 had failed to achieve the set target. "I am enquiring the reason of failure and not issuing the refund by cut the off date".
According to the Terms of Reference of the Task Force, the special teams of tax officials at Karachi, Lahore and Faisalabad have to ensure that whenever the claim is liable to rejection for any reason, the order is passed and communicated to the refund claimant within ten days of the receipt of auditor's/system report.