AIRLINK 73.06 Decreased By ▼ -6.94 (-8.68%)
BOP 5.09 Decreased By ▼ -0.09 (-1.74%)
CNERGY 4.37 Decreased By ▼ -0.09 (-2.02%)
DFML 32.45 Decreased By ▼ -2.71 (-7.71%)
DGKC 75.49 Decreased By ▼ -1.39 (-1.81%)
FCCL 19.52 Decreased By ▼ -0.46 (-2.3%)
FFBL 36.15 Increased By ▲ 0.55 (1.54%)
FFL 9.22 Decreased By ▼ -0.31 (-3.25%)
GGL 9.85 Decreased By ▼ -0.31 (-3.05%)
HBL 116.70 Decreased By ▼ -0.30 (-0.26%)
HUBC 132.69 Increased By ▲ 0.19 (0.14%)
HUMNL 7.10 Increased By ▲ 0.04 (0.57%)
KEL 4.41 Decreased By ▼ -0.24 (-5.16%)
KOSM 4.40 Decreased By ▼ -0.25 (-5.38%)
MLCF 36.20 Decreased By ▼ -1.30 (-3.47%)
OGDC 133.50 Decreased By ▼ -0.97 (-0.72%)
PAEL 22.60 Decreased By ▼ -0.30 (-1.31%)
PIAA 26.01 Decreased By ▼ -0.62 (-2.33%)
PIBTL 6.55 Decreased By ▼ -0.26 (-3.82%)
PPL 115.31 Increased By ▲ 3.21 (2.86%)
PRL 26.63 Decreased By ▼ -0.57 (-2.1%)
PTC 14.10 Decreased By ▼ -0.28 (-1.95%)
SEARL 53.45 Decreased By ▼ -2.94 (-5.21%)
SNGP 67.25 Increased By ▲ 0.25 (0.37%)
SSGC 10.70 Decreased By ▼ -0.13 (-1.2%)
TELE 8.42 Decreased By ▼ -0.87 (-9.36%)
TPLP 10.75 Decreased By ▼ -0.43 (-3.85%)
TRG 63.87 Decreased By ▼ -5.13 (-7.43%)
UNITY 25.12 Decreased By ▼ -0.37 (-1.45%)
WTL 1.27 Decreased By ▼ -0.05 (-3.79%)
BR100 7,461 Decreased By -60.9 (-0.81%)
BR30 24,171 Decreased By -230.9 (-0.95%)
KSE100 71,103 Decreased By -592.5 (-0.83%)
KSE30 23,395 Decreased By -147.4 (-0.63%)

LAHORE: Extensive changes in tax laws on yearly basis and at times more than once in a year, lead to wrong application of the relevant provisions by the tax authorities, followed by wrong assessment of tax liabilities of taxpayers, sources said.

They said it creates uncertainty, compliance costs, inefficiencies, disincentives, and revenues losses, therefore, the government should aim to strike a balance between the need to update tax laws and the need to provide stability and predictability to taxpayers.

The sources further pointed out that the complexity of the situation could be assessed from the fact that the even the appellate forums get confused if no relevant provisions of the law as at the relevant time is reproduced or attached by the litigants, resultantly considerable time is unnecessarily wasted in just trying to ascertain the law at the relevant time.

According to the sources, subsequent amendments in tax laws become a major source of contention between the department and taxpayers where either of the party challenges the wrong application of the law.

The department presses that the amendments made to the law would prevail while the taxpayers disagree with the approach and prefer to challenge the same for an appropriate interpretation.

It is interesting to note that a change in the law at a specific year a fundamental change in tax liability takes place, which becomes a hard nut to crack between the department and taxpayers for long years to come, a phenomenon that has jeopardized the revenue collection in the country.

Sources said the situation becomes further gruesome where a special procedure is devised by the rules to collect tax from certain industrial sectors.

One such sector is that of steel re-rolling mills where sales tax is charged at the rate of eight rupees per unit of electricity consumed for the production of steel billets, ingots and mild steel products excluding stainless steel.

It is a settled principle of the view that the special procedure contains an overriding, Non- obstante effect which prevails over the general clauses of an Act, therefore, the special procedure is considered as a final discharge of sales tax liability, which the department disagrees in most of the cases and prefers to challenge it before the appellate forums.

However, the department fails to prove his stance with reference to any principle of statutory interpretation or a precedent.

Tax experts are of the view that the department should invest on the capacity building of their officers for a better understanding of tax laws in order to minimise unnecessary litigation, which has proven a hurdle in speedy revenue collection growth by and large.

Copyright Business Recorder, 2023

Comments

Comments are closed.