ISLAMABAD: The Federal Board of Revenue (FBR) has decided to expedite cases in high courts where taxpayers have challenged the levy of provincial sales tax on franchise fees, air travel, distribution and transmission of electricity, and long distance international calls license holders.

In this regard, the FBR has issued instructions to the Chief Commissioners Inland Revenue across the country.

The FBR has also taken the decision to give priority to pending cases before high courts where the taxpayers have challenged the levy of provincial sales tax on services and court judgment may affect the collection of federal sales tax.

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According to the FBR’s instructions, the FBR is directed to refer to the subject and to say that several writ/constitutional petitions filed in matters relating to provincial sales tax, especially in interprovincial jurisdiction matters with regard to levy and collection of Provincial sales tax on services, are pending adjudication in various High Courts, wherein FBR has not been impleaded as respondent despite the fact that the finding of the Courts on these matters may affect the collection of sales tax at federal level.

The FBR directed the field formations that there is a need to take stock of pending Writ/Constitution Petitions in high courts by the respective field formations, where the taxpayers have challenged the levy of provincial sales tax on ‘franchise fee’, ‘air travels’, ‘distribution and transmission of electricity’, long distance International calls license holders, etc, and to examine these for impleading and making the FBR and respondent.

Keeping in view the exigency of the matter, the FBR has directed to take necessary arrangement to take stock of pending petitions before the High

Courts where the taxpayers have challenged the levy of provincial sales tax on various/any service type and judgment of the Court thereon may affect the collection of federal sales tax or affect the Constitutional scope of federal sales tax on ‘goods’. Therefore, suitable counsel may be appointed to implead/make the FBR as party in such cases.

The FBR has further directed that in cases of provincial sales tax on services, where FBR has been made respondent, the respective field formation having jurisdiction of the case must issue power of attorney on behalf of the FBR.

Copyright Business Recorder, 2024