Federal Board of Revenue has directed the member Direct Taxes to start recovery of income tax from Pakistan Telecommunication Authority, which values Rs. 9 billion in amount, in response to what FBR had communicated PTA to pay their taxes by August 27, 2008, failing which besides imposition of penalty of u/s 183 additional taxes would also be charged at 12 percent per annum, furthermore FBR believed that tax amount will be recovered by adopting all recovery measures as warranted by Income Tax Law.
It was told by a high level official at FBR that PTA is not paying its taxes for last 10 years, and that the tax amount has reached Rs. 9 billion during this time period. The case has been re-opened after it was settled last year when PTA had paid Rs. 1 billion as an installment, but afterwards telecom authority is using delaying tactics to avoid paying taxes, added FBR sources.
When contacted FBR official, who is responsible to tackle PTA’s case, told us that telecom authority is claiming exception which is not due at all; FBR official further said that exemption from tax is not available to government authorities as it was withdrawn by virtue of overriding provision of section 54 of Income Tax Ordinance 2001.
FBR Officer further told that PTA has been delaying this payment for more than 10 years now. “Limit is limit; we can’t send them notices anymore. FBR may direct Telecom companies to submit their license fee directly to FBR if PTA will keep on delaying this tax amount”, concluded FBR official.
When contacted a PTA official, he refused to comment any thing on the issue, as he believed that the matter is both in High Court and Appellate Tribunals, and must not be commented until it is not decided.
Financial analysts suggest that PTA must give this tax, as all other government authorities are paying their taxes to FBR. The amount has to reach our national treasury… Either PTA pays it directly or it goes through FBR, then why not to follow the rule…?
I’ve been engaged in taxations for lengthier then I care to admit, both on the private side (all my employed life story!!) and from a legal standpoint since satisfying the bar and following tax law. I’ve furnished a lot of advice and rectified a lot of wrongs, and I must say that what you’ve put up makes perfect sense. Please persist in the good work – the more people know the better they’ll be equipped to cope with the tax man, and that’s what it’s all about.