The Federal Board of Revenue (FBR) failed to collect super tax amounting to Rs. 6.69 billion during the fiscal year 2020-21 (FY21).
According to the audit report by the Auditor General of Pakistan (AGP), in 69 cases under the jurisdiction of three field offices of the FBR, taxpayers made less assessment of their income for the payment of super tax. The department did not take any action to recover the tax due from the taxpayers for the tax year 2020, resulting in less realization of the super tax amounting to Rs. 6.69 billion.
The audit report states that the lapses were reported to the department during March to November 2021. FBR replied that an amount of Rs. 8.1 billion had been charged and recovered, while an amount of Rs. 699.14 million was awaiting recovery. It further said that legal proceedings for an amount of Rs. 5.88 billion had been initiated but not yet finalized by the department, while an amount of Rs. 113.19 million was subjudice.
The departmental accounts committee (DAC) in December 2021 directed FBR to recover the charged amount, finalize the legal proceedings, pursue subjudice cases at appropriate appellate forums, and report compliance to the audit by January 15, 2022. It added that no further progress was reported till the finalization of the audit report.
The Section 4B of the Income Tax Ordinance 2001, provides levy of super tax for the rehabilitation of temporarily displaced persons. The prescribed tax rate is four percent in respect of banking companies and three percent in respect of other companies having an income equal to or exceeding Rs. 500 million, according to the audit report.
