ISLAMABAD: The Federal Tax Ombudsman has directed the Chief Commissioner Inland Revenue, Corporate Tax Office Islamabad, to halt all new tax audit proceedings until the previously ordered tax refunds are fully processed.
The directive, issued in response to delays in implementing earlier recommendations, highlights that refunds related to Tax Years 2008 to 2017 must be resolved before initiating audits for Tax Years 2020, 2021, 2022, and 2023. The FTO stated that starting new audits without addressing pending refund matters amounts to maladministration and causes unnecessary burden on taxpayers.
The FTO order referenced instructions issued by the Federal Board of Revenue on February 4, 2022, which prohibit any new audit or recovery proceedings while a complaint is under review by the FTO. It noted that audits should not be conducted during ongoing implementation unless a tax year is approaching its time bar.
The case was scheduled for hearings on May 30 and June 20, 2025, for submission of the final compliance report. However, the department again requested more time instead of submitting the report. The next hearing is set for July 10, 2025.
The FTO has also summoned the Chief Commissioner IR to appear and explain the continued non-compliance and the delay in submitting the required report. The FTO expressed concern over the disregard for legal duties and warned of action if defiance continues.
