ISLAMABAD: The Federal Board of Revenue (FBR) has asked all the federal ministries/divisions/ departments to ensure filing of income tax returns by all salaried employees or face prosecution. The FBR also requested the higher judiciary, including its officers and honorable judges, to file their tax returns.
The FBR has found that so far more than 50 percent public sector employees having annual taxable income did not prefer to come into the tax system. “Now all the federal secretaries have been asked to ensure compliance of filing of income tax returns by employees of their concerned ministry/division,” stated the official.
So far, 27,470 salaried individual employees of the federal government in the jurisdiction of Islamabad filed their tax returns for the tax year 2019 while 35,238 had not yet filed their returns for the current tax year. As the number of non-filers was more than 50 percent, so it forced the FBR to issue fresh instructions to remind the secretaries of ministries concerned for pursuing them to file their tax returns.
The FBR had already initiated proceedings of prosecution against 12 individuals belonging to different walks of life as they earned heavy income but never bothered to come into the tax system. So the FBR wants to set an example by taking stern action against non-filers.
According to official communication sent out to all the federal ministries/divisions and concerned departments on Friday, filing of tax return is a national obligation under the Income Tax Ordinance, 2001. In this regard, the Section 114 of the ordinance stipulates that all salaried employees whose income exceeds Rs600,000 during a fiscal year are chargeable to tax and hence are liable to file their income tax returns as well as wealth statements u/S 116 of the Income Tax Ordinance, 2001. Owing to ignorance of law, each year sizable number of employees do not file their tax returns, thus resulting in decrease in taxpaying population of the country.
The FBR made the request that the concerned ministry’s good office is requested to instruct each and every individual serving in its division/organization and subordinate offices/organizations to file their returns of income without fail in the best interest of revenue on or before the end of deadline of 28th February, 2020 for the Tax Year 2019. “The FBR also takes this opportunity to apprise all the non-filers of tax returns through your august office that Income Tax Ordinance, 2001 has prescribed imposition of financial penalty u/s 182 of the Income Tax Ordinance, 2001, as well as initiation of prosecution proceedings u/s 191, if convicted by the Honorable Special Court (Customs, Taxation and Anti-Smuggling).”