Tax Bar Gives FBR 12 Proposals to Fix Digital Tax System

The Pakistan Tax Bar Association has asked the Federal Board of Revenue to urgently fix issues in its digital tax system, warning that current flaws could undermine ongoing tax reforms.

In a formal submission to FBR Chairman Rashid Mahmood Langrial, the association highlighted gaps in system design, weak governance, and mismatches between digital processes and existing tax laws.

The PTBA said several parts of the system are not properly aligned with legal provisions, while key features like HS code integration and correction mechanisms remain incomplete. It also pointed out that taxpayers currently face difficulties in fixing errors in digital records due to the absence of a proper rectification system.

To address these issues, the association proposed 12 recommendations, including full alignment of all tax laws, rules, and SROs within the IRIS system.

It also called for a complete audit of the system, starting with SRO 297(I)/2023, to identify gaps and ensure compliance with legal requirements. The PTBA stressed the need for full integration of HS codes in tax returns and invoicing systems, along with standardised units of measurement in line with the Sales Tax Act 1990.

A key demand is the creation of a formal system for correcting digital records, including proper audit trails for transparency.

The association also proposed a structured complaint handling system with direct access to FBR and PRAL officials and a clear escalation mechanism. It is recommended that all system-related complaints should be resolved within 48 to 72 hours.

To improve governance, the PTBA suggested restoring an independent Member IT position within the FBR. It also called for clear accountability between FBR and PRAL, along with regular public reporting of system performance, including uptime, errors, and complaint resolution timelines.