FTO Directs Pak Suzuki to Refund Excessive Excise Duty to 24 Complaints

The Federal Tax Ombudsman (FTO) has given directives for the refunding of Excessive Excise Duty to 24 complaints by the Large Taxpayers’ Office (LTO) Karachi in the Pak Suzuki Motor Company case.

A total of 24 complaints were filed against the Federal Board of Revenue (FBR) Islamabad and Pak Suzuki Motor Company Limited for 17 percent sales tax on the purchase of Suzuki Cultus 998 cc vehicles after July 2021 instead of 12.5 percent which was the actual rate at that time. In this way, the taxpayers had to pay more than what was actually due.

The FTO had declared that collection of the sales tax in excess of being legislated in the Finance Act 2021 and the delay in settling the tax refund were tantamount to maladministration. The President of Pakistan had upheld the decision and rejected the FBR’s pleas against the recommendation for a refund.

Representatives of LTO Karachi and Pak Suzuki Motor Company have agreed to resolve the issue under the following implementations:

1. Pak Suzuki will furnish the refund claims to LTO Karachi in respect of the refund due to the subject complaint as per the list provided by the FTO office.
2. The refund claim will be accompanied by the relevant invoices and proof of tax paid on these invoices.
3. After receiving the refund claim, LTO Karachi will process it as per law and issue a refund to Pak Suzuki Motor Company.
4. Pak Suzuki Motor Company will then remit the amount to all the complainants in accordance with their due shares and will submit its proof of payment to LTO Karachi and the FTO Office for the final implementation of the order.

The FTO, Dr. Asif Mahmood Jah, had directed Advisor Income Tax Karachi to hold meetings with the stakeholders for the smooth implementation of the recommendations in the complaints of overcharge of tax by M/s Pak Suzuki.