The filers of income tax returns manually would now be able to enjoy all the tax benefits of taxpayers who are filing returns electronically.
The manual filers of income tax returns would be entitled to reduced rates of withholding taxes at par with the filers of electronic filers of returns.
The FTO has ordered the Federal Board of Revenue (FBR) to adopt some mechanisms and put in place SOPs to ensure that all (Manual) filers of income tax returns for the latest tax year are active as per ATL issued by the FBR.
A top tax lawyer, Waheed Shahzad Butt, had highlighted this anomaly before the FTO in a public interest complaint, wherein the FTO ordered to conduct an investigation and summoned heads of FBR-IR Policy, Operations, Legal wings and Member Information Technology at FTO Regional Office at Lahore, wherein after consultation matter has been resolved without going into litigation and wasting tax money in futile litigation.
When contacted, Waheed Shahzad Butt told ProPakistani that despite the FBR’s responsibility to ensure fair and equitable taxation for all citizens, it has come to light that manual filers of tax returns have illegally been discriminated against electronically filed returns. This failure to cater to the specific needs of this vulnerable segment of the taxpayer community has drawn sharp criticism from various quarters.
Waheed further added that a categorical written intimation/ information regarding the blatant violation of Rule 73 of Income Tax Rules 2002 by FBR and the illegal exclusion of some taxpayers from the ATL database, was moved but all in vain. The FBR, in direct violation of Rule 73, has deemed/ treated the manually filed income tax return for the Tax Year 2022 as “inactive,” despite it being filed within the time specified by law.
FTO order states “Complaint was filed against illegal exclusion of taxpayer from Active Taxpayer List, in violation of FBR Act, 2007 read with Section 206 of the Income Tax Ordinance 2001. The department submitted comments mainly contended that the matter is under process at the Board’s level as communicated to this office.
During the hearing, the Authorized Representative (AR) informed that the FBR has activated the Complainant on ATL, and the necessary steps have been taken. Furthermore, the AR argued that the FBR should implement substantial measures to rectify these shortcomings and issues. This would benefit the general public and other individuals or taxpayers who experience such injustices, even though they have filed their returns.
The FBR is instructed to implement a mechanism and establish a Standard Operating Procedure (SOP) to guarantee that all filers of returns for the current tax year are active in accordance with the ATL issued by the Board. This is to prevent any omissions that could lead to such complaints, as ordered by FTO.
