March ST returns need not carry CNICs, NTNs: SRO suspended

In a major move to facilitate the business community, the Federal Board of Revenue (FBR) suspended the applicability of SRO191(I)/2011 for tax period of March 2012 and extended the date of filing of sales tax and federal excise duty returns up to April 25 this year.
Officials told Business Recorder here on Friday that this decision would only be applicable for the said tax period and computerised national identity card numbers (CNICs) and National Tax Number (NTNs) of the unregistered buyers would not be asked from importers, exporters and manufacturers under the said SRO. The sales tax returns to be filed up to April 25 did not need to carry CNICs and NTNs of unregistered buyers, he added.
Referring to the board's announcement here on Friday, tax experts said that FBR's Member, FATE, and FBR's official spokesperson disclosed the decision. They attributed the decision to a controversy over provisions of computerised national identity card number (CNIC) and National Tax Number (NTN). The provision of CNICs and NTNs of customers by sales tax registered manufacturers, importers and exporters was not getting stockholder's acceptance. Trade bodies and chambers held a number of meetings with the FBR, but failed to develop any consensus, they added.
Arshad Shehzad, a leading sales tax expert, who had rejected the idea a couple of days ago, said that an effort was made by policymakers to introduce some sort of detailed legal framework to tap undocumented transactions to expand the tax net. In the first place, through this attempt, it seemed that the FBR had tried to collect extensive information from areas where nothing was available in the past.
Secondly, while introducing such a requirement, policymakers had forgotten a basic reality that existing taxpayers were an asset of taxation system, any provision/module causing them hardships would not bear positive results. Arshad said, there wasa a consensus that existing taxpayers were already overburdened, bearing the load of revenue generation. The taxpayer community, he said, was well aware that bringing new taxpayers in the system would basically help their own cause. However if they were still not convinced, problems needed to be addressed.
The notification 191(i)/2012 requires all registered manufacturers, exporters and importers to provide details of unregistered buyers to the extent of at least 60% during March 2012, failing which return filers were warned of serious penal action. An increase of 10% in compliance after March was required in subsequent month till its final achievement of 100% by July 2012, a top Karachi-based businessman added.