ISLAMABAD: The Federal Board of Revenue (FBR) has admitted before the Federal Tax Ombudsman (FTO) that the income tax return devised for Tax Year 2023 is calculating incorrect tax liabilities for pensioners, senior citizens and members of Shuhada families.
This was disclosed during the last hearing at the FTO’s office, where Member Inland Revenue Policy officials were summoned to address complaints and concerns raised by tax lawyer Waheed Shahzad Butt for pensioners and senior citizens regarding discrepancies in their tax calculations.
When contacted, Waheed Shahzad Butt raised the issue of refund of the wrongly deducted tax which must be the priority of the FBR without causing harassment to the pensioners, senior citizens and members of Shuhada families. The FBR has assured that the FBR is rectifying the error in the new income tax return.
He informed that during the course of hearing before Adviser FTO Naseer Butt, the officials acknowledged that a flaw in the tax return calculation mechanism has led to inaccurate tax liability assessments for this particular demographic.
Earlier, a complaint was moved by a senior retired Army officer through tax lawyer Shahzad Butt, and the office of the FTO had issued notice to the secretary Revenue Division and FBR Members to probe the allegations of maladministration as to why the FBR’s system is computing wrong income tax liability with incorrect rebate available to pensioners, senior citizens and members of Shuhada families, for the tax year 2023.
Tax lawyer Waheed Butt stated that FBR Policy Wing is facing severe criticism for its failure to effectively address the issue of tax reduction on tax charged on yield on Behbood Certificates/ Pensioner’s Benefit Account/ Shuhada Family Welfare Account under Code “930101” in the income tax return devised by the FBR for Tax Year 2023.
The flawed tax calculation has raised concerns among pensioners and senior citizens, many of whom rely on fixed retirement incomes and have limited financial resources. The incorrect tax liability calculations have resulted in undue financial burden and distress for these individuals, who were shocked to find their tax obligations higher than they should rightfully be.
Member Policy should tender an apology before the pensioners, senior citizens and Shuhada Family for the professional negligence and must be assured that illegal extra tax recovered through faulty tax return should be returned back promptly.
Despite the FBR’s responsibility to ensure fair and equitable taxation for all citizens, it has come to light that pensioners, senior citizens and members of Shuhada families are being deprived of their rightful tax reduction entitlements, Waheed added.
Copyright Business Recorder, 2023