Revision in GST returns due to FBR FASTER glitches: Refusing exporters’ requests tantamount to maladministration: FTO

ISLAMABAD: The Federal Board of Revenue (FBR) has committed a serious nature of maladministration by refusing requests of exporters for revision in the sales tax returns due to malfunctioning of the FASTER refund system.

In a new order issued on Monday, the FTO is shocked that the FBR disallowed condonation of delay in filing of sales tax returns despite recommendations of the Chief Commissioners in the field formations.

Hence, the observations of the FBR is totally misconceived and against the reports of the chief commissioners/commissioners. In fact, the chief commissioners/commissioners have clearly explained the reasons and have given justifications for condonation of delay which has not only been ignored but facts have been misreported by the FBR.

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According to the order issued by the FTO against the FBR on Monday, refusing the requests of complainants for revision of sales tax return by the FBR on account of delay in the presence of its own circulars wherein it was admitted that the FASTER is malfunctioning and condoning delay in some cases is tantamount to maladministration.

The FBR should direct the Member Inland Revenue (Operations) to revisit the condonation order and condone the delay and to settle the issue of sales tax refund/credit claimed resultantly becoming due, if any, for the relevant tax periods expeditiously.

From July 1, 2019, sales tax refund procedure was changed and a new system, FASTER was introduced to process and sanction exporter’s refund expeditiously that requires a complete different approach than the previously adopted manual system.

The sales tax returns filed under the FASTER was facing different problems as data of previously filed returns were not being matched. The major issue observed is that the refund claimed in previous return before the introduction of the FASTER was not carried forward for processing in the FASTER.

To resolve the issue, the taxpayers applied for condonation of delay in filing of sales tax returns, but the FBR refused to condone the delay in filing of sales tax returns.

As credit of refund could not be claimed unless previous returns/Annexure-H was revised, hence applications were made to the FBR for condoning the delay for revision of returns. “The FBR did not condone the delay without realizing that delay was not because of any fault of the taxpayers but it was because of systemic problems,” the FTO stated.

The root cause of the issue is malfunctioning of the FASTER system till date, admitted by the FBR by issuing circular 3 of 2020 and STGO 9 of 2023. While giving decisions the FBR has ignored its own circulars, wherein, the FBR itself admitted that the FASTER is malfunctioning that creating problems for the taxpayers. On the other hand, issue of allowing condonation of filing of revised sales tax returns on the same issue, the Board has already issued condonation letters to other exporters.

Copyright Business Recorder, 2023