The Federal Board of Revenue (FBR) has announced that it will suspend or blacklist sales taxpayers who refuse to allow tax officers access to their business premises for monitoring stocks, production, or clearances.
Under the updated Sales Tax Rules 2006, the FBR can suspend the registration of a taxpayer if the Commissioner or Board believes that the taxpayer is involved in tax evasion, issuing fake invoices, or committing fraud. The suspension can be carried out without prior notice, pending further inquiry.
The new procedure, designed to ensure consistency between the Large Taxpayer Offices (LTOs) and Regional Tax Offices (RTOs), specifies that suspension may occur if a taxpayer refuses access to business premises under sections 40B and 40C of the Sales Tax Act or fails to provide required records to Inland Revenue Officers.
Other grounds for suspension include discrepancies in business activity that exceed five times the declared capital and liabilities, excessive purchases or supplies from other suspended persons, non-filing of returns for three consecutive months, or filing fraudulent returns.
The FBR also emphasized that taxpayers would be provided with the opportunity for public hearings before any formal action is taken.
