FRIDAY SEPTEMBER 02: Non-filers of income tax returns: FBR starts enforcement exercise against NTN holders

ISLAMABAD: The Directorate General of Intelligence and Investigation, Inland Revenue (IR) Federal Board of Revenue (FBR) has started a national enforcement exercise against all National Tax Number (NTN) holders, who are on tax-roll during July 1, 2007 to June 30, 2010, but failed to file their income tax returns and statements.
Sources told Businesses Recorder here on Tuesday that the FBR has issued instructions to all Chief Commissioners of Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) to take enforcement action against the NTN holders, who are not filing returns to ensure maximum return filing by the end of September 2011.
The enforcement plan was has been communicated to the field formations through the FBR's instructions dated August 30, 2011. The exercise has been started at national level as most of the persons, who have obtained NTNs during July 1, 2007 to June 30, 2010 have not filed the income tax returns, reflecting highest level of non-compliance across the country.
The situation is so alarming that the FBR has immediately launched national enforcement exercise for filing of returns by the NTN holders. As most of the persons file return in September 2011, the FBR has also started national enforcement exercise against the non-compliant NTN holders. The timing of the exercise would improve the level of compliance by NTN holders, who are not filing their returns.
Sources said that the national enforcement plan has been implemented across the country to take action against the NTN holders, who are liable to file returns, but deliberately avoiding to discharge their duties. Sources added that the FBR wanted to send a clear and loud message to the non-filers of income tax returns that the FBR is vigilant and NTN holders cannot escape from mandatory requirement of filing of returns. Even if a person has obtained an NTN few years ago, he has to file return as admissible under the law.
According to the FBR's instructions issued to the field formations dated August 30, 2011, the Directorate General Intelligence IR has conducted an exercise to ascertain return-filing status of the persons who have been issued NTNs during the period of July 1, 2007 to June 30, 2010. The obtained information has revealed that in majority of the cases, the NTN holders have failed to file returns. The quantum of non-compliance is evident from the year-wise break up of such cases pertaining to LTUs/RTOs.
The FBR has further informed the LTUs/RTOs that the year-wise lists of the non-filer NTN holders are therefore sent to the field formations, electronically. The information contains complete particulars such as name, address, NTN, CNIC, Business name and address with information as to whether returns have been filed in the years subsequent to the issuance of NTN and amount of income declared in case returns have been filed.
The FBR has further directed the field formations that the cases of non-filer NTN holders may be pursued for enforcing the filing of returns with information about compliance enforced shared with the Directorate General Intelligence IR. The co-ordinated action backed by determination on the information provided may not only ensure filing of returns in the cases contained in the concerned lists but will also send a message to all the non-filers that their cases will not escape the vigilance of the FBR. As an immediate impact of this exercise, a sharp rise in filing of the return for Tax year 2011 in the coming September is expected if pursued in letter and spirit, FBR instructions added.