KTBA concerned over practices adopted by FBR field offices

KARACHI: Karachi Tax Bar Association (KTBA) has expressed grave concerns over practices adopted by FBR field offices in Karachi, which the bar claims are disrupting businesses and undermining legal compliance.

In the letter sent to the federal finance minister and chairman FBR, the KTBA alleged that processing of new sales tax registrations has “virtually halted” over the past six months, creating barriers for businesses attempting to meet their statutory obligations.

The bar alleged that the field offices were calling documents that contravened Section 14 of the Sales Tax Act, 1990, and related regulations.

Field formations are operating outside legal parameters, placing unjustified burdens on taxpayers seeking registration, KTBA said, adding that these delays have serious economic consequences for new businesses.

The tax bar has also raised alarms over what it describes as “discretionary and opaque proceedings” to suspend or blacklist registered businesses. According to the KTBA, these actions defy Supreme Court decisions in prominent cases, including Eagle Cables (CPLA 2400-L/2022) and Skypak Enterprises (CPLA 682/2017).

The letter further said that these practices have “generated widespread dissatisfaction and negativity within the business community” with some situations escalating to “unpleasant episodes” at field offices. The KTBA warned that these issues are eroding trust in the FBR’s institutional credibility and creating conditions ripe for “exploitation and corrupt practices.”

The KTBA claimed that they had previously attempted to engage with the FBR in early March but had received no response and added that the recent extensions in sales tax return filing deadlines as a tacit acknowledgment of operational instability within the tax administration system.

Moreover, the KTBA has called for immediate action on three fronts: resuming new sales tax registrations with mandatory timelines, discontinuing arbitrary suspension practices, and engaging stakeholders to resolve persistent issues.

Copyright Business Recorder, 2025