Assets Declaration Ord: Taxpayers making payment to get one-time opportunity: FBR

ISLAMABAD: The Federal Board of Revenue (FBR) has decided to grant one-time opportunity to taxpayers who paid their tax within the due date, ie, July 3rd, 2019 under the Assets Declaration Ordinance-2019 but could not file their declarations due to any reason.

In this connection, the FBR has issued circular 6 of 2021, here on Friday to grant relaxation in filing of declarations under Assets Declaration Ordinance-2019

According to the circular, the FBR has decided to grant one-time opportunity to the taxpayers who paid their tax under the Assets Declaration Ordinance-2019 but somehow could not file their declarations.

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The Assets Declaration Ordinance, 2019 was promulgated on May 14th, 2019 for payment of tax and declaration of corresponding assets by June 30th, 2019.

The due date was extended till July 3, 2019.

Taking cognisance of the hardship caused and to facilitate the aggrieved citizen taxpayers, the FBR has decided to allow filing of declarations for all those citizen taxpayers/persons who deposited tax under the Ordinance within the due date i.e. July 3rd, 2019 but could not file their declarations due to any reason.

The system has been enabled for the purpose and all taxpayers can now file their declarations between September 10th, 2021 till September 25th, 2021.

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This is a special dispensation granted under Section 7 of the Federal Board of Revenue Act, 2007, the FBR added.

When contacted, a tax expert said that the circular has been issued in line with the directions of the president and the Federal Tax Ombudsman (FTO).

President Dr Arif Alvi has directed the FBR to take measures to resolve the matter of filing of declarations by the aggrieved persons, who have deposited tax of billions of rupees under the Tax Amnesty Scheme (Assets Declaration Scheme).

In this regard, the president has upheld the order of the FTO and disposed of the appeals/representations referred by the FBR against the landmark order issued by the FTO.

The president has quoted Section 17 of the Assets Declaration Ordinance under which the federal government can resolve the matter and remove the difficulties.

Despite the fact that the declarants have deposited billions of rupees two years ago, the FBR has not resolved the matter of the taxpayers, the president added.

The FTO had directed the FBR to facilitate thousands of taxpayers in filing of declarations under the amnesty scheme (Assets Declaration Ordinance 2019), who deposited billions of rupees as tax, but unable to upload their declarations on the last date, i.e., July 3, 2019 due to failure of the FBR’s IT system.

In this regard, the FTO had issued a landmark judgment (0011/OM/2020) to give relief to the aggrieved persons availing the amnesty scheme. The FTO has recommended the FBR to make arrangements and facilitate the filing of declarations in respect of all the aggrieved persons by invoking the provisions of Section 17 of the Income Tax Ordinance; update the IT system of the FBR, which requires thorough review and efficient improvement and report compliance within 45 days.

The FTO on own motion and on various petitions of Amnesty Declarations represented by Pakistan Tax Bar Association, who deposited the due taxes for availing Amnesty Scheme but could not file the declarations as per law due to failure of FBR IT system IRIS on last date of Amnesty Declaration 2019, as on July 3, 2019, has declared inefficiency, Incompetence of the officials of FBR, while designing the IT system to fulfill the needs of Public availing the Amnesty Declaration Ordinance 2019.

According to the findings of the FTO, inefficiency, negligence and incompetence of the department officials in designing the system making adequate arrangements and failure to give full effect to the provisions of the Ordinance does amount to maladministration in terms of Section 2(3)(ii) of the FTO Ordinance, 2000.

Sanctity of asset declarations

The order of the FTO issued here, on Thursday, revealed that an own motion investigation was initiated while exercising powers conferred u/s 9(1) of the Federal Tax Ombudsman Ordinance, 2000 (FTO Ordinance) on the complaint of delegation of office bearers of Pakistan Tax Bar Association (PTBA) to the FTO, alleging that thousands of taxpayers/persons who intended to avail the benefit of Amnesty Scheme, promulgated by the Government of Pakistan, as Assets Declaration Ordinance, 2019 (the Ordinance) deposited billions of rupees of tax but were unable to upload the declaration of assets, on the last date, ie, 03.07.2019, due to failure of IT system of the department (Dept).

The Dept had failed to pre-empt this situation, where generation of CPR should have been subject to uploading of the declarations. In that situation, no such anomaly would have arisen, wherein thousands of declarants who paid billions of rupees in tax had been misled. Again gravity of the situation had not been evaluated because the tax so deposited was neither refundable nor adjustable, FTO said.

The emphasis of the Dept that the tax chargeable of the declaration was not the requirement of the Ordinance, appears to be vague.

It was the responsibility of the Dept to keep the system running smoothly till the last minute but unfortunately, it failed to cater to the needs of the declarants.

The general public had suffered because of the inadequate arrangements made by the FBR to address the expected load on its system.

Since the department has failed to ensure smooth functioning of its IT system to facilitate the prospective declarants, to avail the amnesty scheme by uploading their declarations on the last date.

Therefore, it amounts to incompetence and inefficiency.

On part of the FBR officials, the FTO stated.

The record reflects that thousands of declarants paid tax of Rs2.6 billion up till 03.07.2019. Almost a year has elapsed but the Dept has taken no measure to address their grievances. The Dept has been well aware of the failure of the system in giving effect to the scheme.

Therefore, it was imperative upon the Dept to remove that difficulty/anomaly by invoking the provisions of Section 17 of the Ordinance. In light of the above stated discussion; inefficiency, negligence and incompetence on part of the FBR officials is established, the FTO order added.

Copyright Business Recorder, 2021