FBR directed to help 12,000 taxpayers declare assets, avail amnesty scheme

ISLAMABAD: The Federal Tax Ombudsman (FTO) has issued a landmark judgment directing the Federal Board of Revenue (FBR) to give relief to 12,000 taxpayers who had deposited Rs2.6 billion tax under the Tax Amnesty Scheme (Assets Declaration Ordinance 2019) but were unable to upload their asset declaration due to failure of the FBR online system on the last day. 

The FTO recommendation states that despite the passage of almost an year, FBR has taken no measure to address grievances of the aggrieved taxpayers. It further said that FBR was well aware of the failure of its online system, due to which 12,000 taxpayers suffered.

The FBR had contended in its reply to the FTO that the filing of declaration of assets and not the payment of taxes was a prerequisite for availing the scheme. It further said that FBR’s online system had been fully functional, and that complainants never accessed the FBR website. However, FBR also accepted that there was increased pressure on its online system on the last date for submitting declaration of assets. 

During the hearing, Pakistan Tax Bar Association (PTBA) president contended that FBR’s online system had been non-responsive and that this fact has been confirmed in a statement on electronic media by then FBR chairman Shabber Zaidi. 

PTBA rejected FBR’s claim that its system had been fully functional. PTBA also provided screenshots showing unavailability of the online system to FTO. Earlier PTBA had also forwarded the screenshots to FBR.   

FTO observed that unavailability of the online system amounts to incompetence and inefficiency on part of the FBR. The purpose of Tax Amnesty Scheme was to create a culture of documentation in the economy and tax compliance but non-responsiveness of the FBR’s e-portal deprived the declarants to avail the scheme, FTO added.  

FTO report states that FBR had realised its fault in handling the situation and allowed an extension to taxpayers for submitting their asset declarations. It further stated that giving an extension was against the provisions of the ordinance and FBR’s contention that uploading of the declaration was a prerequisite for availing of the scheme.

The FTO has recommended the FBR to make arrangements and facilitate the filing of asset declarations by invoking the provisions of Section 17 of the Income Tax Ordinance, update FBR’s IT system and report compliance within 45 days.