A parliamentary panel was informed on Tuesday that tax recovery cases amounting to Rs 154 billion are in litigation and nobody knows when the courts will decide these cases. The Chairman of the Federal Board of Revenue (FBR), Salman Siddique briefed a meeting of the special committee No III of Public Accounts Committee (PAC), which met here with Yasmeen Rehman in the chair to discuss tax recovery cases pending in different courts for long time.
The FBR chairman said out of Rs 154 billion, disputed tax recovery cases of approximately Rs 37 billion are sub judice in the Supreme Court only and the cases are pending before different courts for the last so many years. "This is the situation of [tax] recovery cases....[and] God knows when the apex court will give its verdict on the cases lying pending before it for the last many years," Siddique added.
Yasmeen Rehman directed the FBR chairman to step up efforts for expediting the cases as early as possible and if necessary law and justice ministry may be involved so that the taxpayers' money could be brought back to the national kitty. The committee also directed the FBR to present a detailed list of all sub judice cases to the committee. "Provide a comprehensive list of [sub judice] cases to the PAC and make sure that this is public money and it must be recovered," she maintained.
Salman Siddique denied reports that the ginners were given blanket cover from the withholding tax. He said the cotton procured from farmers was exempted from withholding tax but ginners were liable to pay tax if they procured it from the Arhties (brokers).
The FBR has decided to facilitate the ginning sector by taking three major steps. Firstly, when cotton ginners will purchase raw cotton from growers, they would not be subjected to 3.5 percent withholding tax.
Secondly, the mandatory provision for making payment through banking channel would not be applicable on growers. Thirdly, the grower is already exempted from tax. However, if the ginner would make purchases of cotton from commission agent, it would be subjected to deduction of 10 percent of the commission.
Siddique said there were some reports that POL products' smuggling from Iran was on the rise and steps would be taken to curb the menace. The PAC expressed concern over the loss caused by the Afghan transit trade to the exchequer. The committee asked the FBR to take tangible steps to block influx of Afghan transit goods back to Pakistan as they are hurting the national economy badly.
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