Withholding tax: Notices based on incorrect data, says Apparel Forum

FBR has issued hundreds of notices for short payment of tax.

KARACHI: Pakistan Apparel Forum Chairman Muhammad Jawed Bilwani has said that the Federal Board of Revenue (FBR) has wrongfully issued hundreds of notices for short payment of withholding tax to its members.

Elaborating, he said in a statement that a large number of companies had complained about the issuance of notices from tax officers for short payment of sales tax based on wrong data.



“The irony is that all the notices contained incorrect details and application of law,” he said, pointing out that the textile sector was liable to pay sales tax at reduced rates of 2% and 3%.

While issuing the notices, a 17% sales tax was considered and with that assumption withholding tax was also calculated accordingly. “This is carelessness on the part of FBR officials.”

Bilwani said the issuance of such notices was an exercise in futility and caused problems for the businessmen in their work. “The field formation of the FBR does not reflect a good reputation and such an approach of the top FBR management gives a free hand to the field formation, which only encourages corruption.”

He emphasised the need of implementing checks and balances against illegal notices and orders.

Bilwani added in the absence of any legal provision and proper mechanism where illegal steps of tax officers could be questioned, the business community were at the mercy of the tax officials.

He pointed out that the industry was already struggling due to the energy crisis, deteriorating law and order situation, international recession and high cost of doing business.

He urged the finance minister to intervene and
resolve the issue of illegal tax notices.

Published in The Express Tribune, December 27^th,  2014.

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