FBR defers top 20 taxpayers' input tax adjustments till 30th

MUHAMMAD ALI

KARACHI: In a clear violation of taxation rules, the Federal Board of Revenue (FBR) has directed its all field formations to defer the input tax adjustments of its top 20 taxpayers till June 30, to achieve uphill budgetary target of Rs 1.952 trillion.

According to sources in FBR headquarter, FBR Chairman Mumtaz Haider Rizvi through video conference held on June 12, directed all chief commissioners to defer tax adjustments and refunds payments in their respective tax offices till the end of current fiscal year with the aim at meeting its annual revenue target.

The sources said all refund payments and tax adjustments would not be delayed as the chairman office has sent the names of taxpayers to the tax offices for the said exercise.

They said the board had selected top 20 taxpayers in each tax office and directed its field formation to hold their tax adjustments and refunds payments.

They said that all three Regional Tax Offices (RTO) of Karachi despite lodging complaints in the board about unprecedented increase in annual revenue targets had been asked to convince their top 20 taxpayers to ensure the payments of monthly tax liability without adjustments.

The sources said that other tax offices of the country including Large Taxpayers Unit (LTU) Islamabad, LTU Lahore, RTO Abbottabad, RTO AJK, RTO Faisalabad, RTO Gujranwala, RTO Hyderabad, RTO Islamabad, RTO Multan, RTO Peshawar, RTO Quetta, RTO Rawalpindi, RTO Sargodha, RTO Sialkot, RTO Sukkur and RTO Bahawalpur were also ordered to show artificial revenue figures through this exercise.

Moreover they said the LTU Karachi after the chairman's directive had decided to discontinue the input tax adjustments and refund payments amounting to over Rs 22 billion of its top 20 taxpayers including Indus Motor Company Limited, Pak Suzuki Motor Co Limited, Atlas Honda Limited, Unilever Pakistan Limited, Engro EXIMP (Pvt) Ltd, Shell Pakistan Limited, Sui Southern Gas Company Limited, Karachi Electric Supply Company, Chevron Pakistan Limited, Trading Corporation of Pakistan, Hasco Petroleum Limited, Dalda Foods (Pvt) Ltd, Procter and Gamble Pakistan (Pvt) Ltd, Star Enterprises-1, Colgate-Palmolive (Pakistan) Limited, Pakistan Steel Mills Corporation (Pvt) Limited, Engro Fertilizers Ltd, Warehouse-Tapal Tea (Pvt) Ltd and Pakistan State Oil Company Limited, they said.

The LTU Karachi, which had to generate Rs 95 billion in June, could end up short of its budgetary target by some Rs 35 billion despite putting its best in the field, sources said.