FBR introduces alternative dispute resolution system
Step taken to resolve Rs1,276b tax cases, cover revenue shortfall
Representational image. PHOTO: REUTERS
ISLAMABAD:
The Federal Board of Revenue (FBR) has introduced a new system for alternative dispute resolution to resolve over 31,000 pending cases in various legal forums.
The step has been taken to resolve Rs1,276-billion worth of tax revenue cases and help cover the Rs170-billion expected shortfall in FBR revenues. According to the plan, an Alternative Dispute Resolution Committee (ADRC) will be set up, headed by a retired judge, who will charge Rs75,000 or 4% of the recovered amount, while committee members will be paid Rs50,000 or 3%, whichever is lower.
The FBR will make these payments from its budget while decisions of the committee will be binding on both the applicants and the FBR. However, criminal proceedings and legal implications for other cases will not be taken up by the ADRC.
The FBR has already released a notification in this regard after amending Rule 231 of Income Tax Rules 2001, according to which tax defaulters need to send their applications to the FBR chairman. Only people under the FBR panel, meeting the specified criteria, will become part of the committee.
After the formation of the committee, the applicant or the related inland revenue commissioner may take back their appeals through the concerned appellate authority or court of law, after which the ADR committee will carry out proceedings for the tax dispute as per the procedure and dates specified by its head.
The committee after its formation and return of pending appeals should finalise the case within 120 days and forward the verdict to the FBR.
According to senior FBR officer, tax revenue in excess of Rs1,276 billion remains uncollectable on account of thousands of unresolved cases. The amendment in the income tax rules will facilitate out-of-court settlements and reduce the burden on FBR, as well as tax defaulters.
Published in The Express Tribune, January 25th, 2019.
The Federal Board of Revenue (FBR) has introduced a new system for alternative dispute resolution to resolve over 31,000 pending cases in various legal forums.
The step has been taken to resolve Rs1,276-billion worth of tax revenue cases and help cover the Rs170-billion expected shortfall in FBR revenues. According to the plan, an Alternative Dispute Resolution Committee (ADRC) will be set up, headed by a retired judge, who will charge Rs75,000 or 4% of the recovered amount, while committee members will be paid Rs50,000 or 3%, whichever is lower.
The FBR will make these payments from its budget while decisions of the committee will be binding on both the applicants and the FBR. However, criminal proceedings and legal implications for other cases will not be taken up by the ADRC.
The FBR has already released a notification in this regard after amending Rule 231 of Income Tax Rules 2001, according to which tax defaulters need to send their applications to the FBR chairman. Only people under the FBR panel, meeting the specified criteria, will become part of the committee.
After the formation of the committee, the applicant or the related inland revenue commissioner may take back their appeals through the concerned appellate authority or court of law, after which the ADR committee will carry out proceedings for the tax dispute as per the procedure and dates specified by its head.
The committee after its formation and return of pending appeals should finalise the case within 120 days and forward the verdict to the FBR.
According to senior FBR officer, tax revenue in excess of Rs1,276 billion remains uncollectable on account of thousands of unresolved cases. The amendment in the income tax rules will facilitate out-of-court settlements and reduce the burden on FBR, as well as tax defaulters.
Published in The Express Tribune, January 25th, 2019.