Annual report-2010 of FTO: 1,437 tax-related cases decided out of 1,446 complaints

The office of the Federal Tax Ombudsman (FTO) has decided 1,437 tax-related complaints in 2010 against 1,446 complaints received during this period and 1,195 cases (83 percent) were decided in favour of the complainants including taxpayers and business community.
The annual report-2010 of the FTO office released here on Wednesday shows remarkable performance of FTO Dr Muhammad Shoaib Suddle, who played a key role in disposal of large number of complaints filed against the Federal Board of Revenue during 2010. One of the major achievements of the FTO office is that the FTO's findings and recommendations resulted in the refund of more than Rs 7 billion to the aggrieved taxpayers during the year, which is 32 times more than the average amount refunded to taxpayers over the past 9 years.
According to the annual report-2010, during the year, the FTO office continued to pursue the policy of expeditious investigation and timely disposal of the complaints, employing the techniques of business process re-engineering (BPR), capacity building, and IT enablement. As a consequence, the FTO Office took on average 67 days (or 58 working days) to dispose of a taxpayer's complaint during 2010, from 117 days for 2009. Over 70 percent of the complaints were decided within 60 days of their receipt, while less than 10 percent took more than 90 days owing to the complexities involved. This unprecedented performance not only since the establishment of this office but also compared to other ombudsman offices at home and abroad.
Our target for 2011 is to further reduce the time taken in disposal of complaints through an increased use of IT-networking of our offices and web-based complaint management system, it said. In 2010, the FTO disposed of a total of 1,437 complaints. While previous year's 176 complaints were decided by March 2010 and over 87 percent (1,261) of the fresh complaints (1,446) received in 2010 were also disposed of during the year; 185 complaints pending at the end of 2010 were mostly those filed in November and December 2010.
Out of 1,437 decided complaints, the FTO rejected 242 (17 percent). In 1,195 cases (83 percent), the taxpayers received relief from the FTO. Out of these, in 367 cases, the FTO redressed the grievances of the taxpayers without going through the cumbersome process of formal hearings, which is a welcome change on the part of tax officials, while 828 complaints were decided after formal hearings. Out of the formally decided complaints, in 510 cases the FTO recommended to the FBR to provide refunds to the taxpayers.
A regional break-up reveals that the FTO's Lahore office attracted more aggrieved taxpayers in 2010, that is, 815 complaints as compared to 398 complaints registered with the Karachi office.
As many as 955 complaints filed during 2010 pertained to income tax, 276 to sales tax and 205 to customs. Only 10 complaints involved the federal excise. The report said that this year, the FTO for the first time exercised its suo motu powers to address incidents of tax maladministration involving systemic issues. As many as 195,331 several-year-old refund claims were got settled under suo motu actions by the FTO during the year under review. This proactive step led to refunds involving Rs 5 billion to thousands of cash-starved taxpayers.
These cases included as many as 194,056 duty draw-back cases involving refunds of Rs 4.9 billion, 805 customs cases of held-up bank guarantees worth Rs 80 million and 400 sales tax cases involving refund of Rs 180 million. These sales tax cases were brought to the notice of the FTO during his visit to the Sialkot Chamber of Commerce and Industry in February 2010. Besides, another amount of Rs 191 million got refunded in 70 additional Sales tax cases. Similarly, on his own initiative, the FTO intervened with the FBR to get resolved hundreds of customs cases stuck owing to procedural formalities for the last several years, the report added.