ISLAMABAD: The Federal Board of Revenue’s (FBR) online system is showing the status of government departments/ organisations, including the Federal Tax Ombudsman office (holders of Free Tax Numbers), as "inactive" due to system flaws.
In a communication to the chairman of FBR, tax lawyer Waheed Shahzad Butt pointed out that the income tax status of the Federal Tax Ombudsman (FTO) office is “Inactive” due to the non-filing of income tax returns.
When contacted, a senior FBR official told Business Recorder that the FTO office is a constitutional position of the federal government and the federal government department, not making any income, and is not liable to file income tax returns. The federal government is not required to file income tax return, he added.
The FBR has allocated Free Tax Numbers (FTNs) to all government departments including the FTO office and for the purpose of deduction of withholding taxes being withholding agents. Their tax liability is to deduct and deposit the withholding taxes as they are not doing any kind of business or earning profits. The holders of the FTNs are not liable to file returns and it is a system flaw that the FBR is showing FTNs as "inactive". When such government departments are allocated FTNs, then there is no need to give them the status of "inactive".
Mostly, the FTNs are legally required to file withholding statements of income tax and sales tax electrically, but they are not filing their withholding statements.
The letter of Waheed Shahzad Butt addressed to the FBR chairman stated that the office of the FTO has not filed its own income tax returns within time prescribed under Section 114 of the Income Tax Ordinance, 2000.
It is learnt that a tax lawyer Waheed Shahzad Butt under the provision of Article 19A of the Constitution questions the working of senior FBR officials to remain silent to enforce fiscal laws in the Islamabad Capital Territory when there is a blunt violation of law by the government departments.
As per law, the personnel’s representing forum of accountability (FTO) are public servants in the light of Section 27 of the FTO Ordinance, 2000 read with Section 21 of the Pakistan Penal Code, 1860.
Waheed Shahzad’s questions to FBR under Article 19A of the Constitution why the only forum of accountability (FTO) remain "Inactive" for many years, letter of the lawyer to the FBR chair added.
Copyright Business Recorder, 2023