FBR waives penalties against custom duties

Fines ignored to attain the grand tax collection target for current fiscal year.

ISLAMABAD:

The country’s tax authority, Federal Board of Revenue (FBR) on Friday announced waiver of penalties against custom duties in order to achieve its over-ambitious target of tax collection set for the current financial year 2011-12.

According to the official statement released, the FBR said that in order to ensure deposit of the outstanding principal amount of customs duty by June 30, 2012, the federal government has remitted whole amount of penalties, fines and surcharges under the section 202A, payable by a person against whom an amount of customs-duty is outstanding on account of any audit observation, audit report, demand notice or any adjudication order or who has failed to pay any amount of customs duty or claimed inadmissible refund or drawback of taxes due to any reason.

“It has been notified that in case where refund becomes due to any persons in consequence of a decision or judgment at a later stage after the issuance of this notification, the customs duty deposited by that person under this notification shall be refunded to him,” said the press release.

The move is one of measures the tax authority is pursuing to achieve this year’s revenue target of Rs1.952 trillion. From July 2011 to April 2012, the FBR collected Rs1.42 trillion in taxes and has to bag another Rs528 billion in the remaining two months to reach its target. Unofficially, the target has been revised to Rs1.928 trillion, according to an FBR official.

Hub Power Company (Hubco) last month availed a similar tax benefit scheme launched by FBR and paid its liability amounting to Rs1.65 billion, showing the strategy utilised by FBR can work.

Consequently, Hubco was exempted from default surcharge and penalty for non-payment.

As per the scheme, exemption was granted on the entire surcharge and penalty for non-payment, if the defaulter pays actual tax dues by May 31, 2012.

Published In The Express Tribune, June 23^rd, 2012.