Tax authorities directed not to conduct raids prior to permission from FBR Chairman, Member Operations

ISLAMABAD: The Senate committee on Finance, Revenue, Economic Affairs, Statistics and Privatization Thursday directed tax authorities not to conduct raids on any filer taxpayer prior to the permission of Chairman Federal Board of Revenue (FBR) or Member Operations of the board.

After hearing a list of tax related complaints by business representatives, Chairman of the Committee, Saleem Mandviwalla directed FBR authorizes that if they wanted to conduct raid on some suspicion of tax evasion, it should be done on the orders of Chairman FBR or Member Operations.

The power of raid should not be kept with commissioners or RTOs, the Chairman said adding "this measure would earn respect for FBR as well as for taxpayers."

The meeting of the committee was attended by Senators, Kamil Ali Agha, Ilyas Ahmad Bilour, Mohsin Aziz, Chairman FBR, Dr. Muhammad Irshad and representatives of business community from all across the country.

He said that FBR Chairman as well as Member Operation would be answerable for any raid and informed them that the committee would be devising a mechanism to monitor these raids on monthly basis.

However, he clarified that there was no restriction of raids on non-filers, which he said could be conducted on the order of other authorities as per the procedure.

Earlier, speaking on the occasion, FBR Chairman assured the house that he would be taking all possible measures to resolve the complaints of the business community.

He said that he has already taken action on some complaints regarding manipulation in tax matters by some tax officials.

He informed the committee that as many as 237 raids were conducted which resulted in revenue collection of Rs2.85 billion.

He assured the businessmen that their pending cases would be referred to Alternative Dispute Resolution Committee (ADRCs) for immediate resolution.

The Committee members as well as businessmen were of the view that FBR officials were using coercive means and were harassing business community.

They were of the view that instead of broadening tax base, the FBR was overburdening existing taxpayers, and urged that the board should devise a comprehensive strategy to bring the non-filers into tax net.

They said that if the practice of coercion and harassment continued, it would have negative impact on tax generation and argued that the FBR would have achieved a meager tax collection through such raids.

The business community representatives also demanded implementation on the proposals of Tax Reforms Committee, which they said would help resolve problems.

They also suggested abolishment of certain articles from tax laws which are being misused and lead to their harassments in terms of audit.

They said that they were not opposed to audit, however it should be done on merit basis and on the basis of computer balloting, however added that the FBR officials were selecting the audit cases on their own will.