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IR officials flay manual tax refund system

IR officials flay manual tax refund system

KARACHI: The Inland Revenue senior officials have revealed their apprehension over the manual refund system, claiming it would direct us to ‘corruption’, as Federal Board of Revenue (FBR) has given flexible powers to commissioners and other officials.

Sources at the Karachi Regional Tax Office (RTO) exposed that during the last decade, FBR had given attention on the computerisation of tax refund system and improved it by the replication of paid tax amount with the supplier, as well as of its claim by the buyers.

‘This automated system not only restricts the processing / sanctioning officers, but also keeps them on track that creates deterrence against the corruption of tax officers,’ an official said on the condition of anonymity.

‘The direct tax in Pakistan mainly based on withholding / advance regime where withholding agent on behalf of the FBR deduct the taxable amount. The regime is subject to adjustment or refund but in some cases the liability falls under final taxation, he said.

The tax officials said the computation of tax on taxable income is purely based on accountancy and thus the assessment of taxable income from the taxpayer’s annual accounts or from the individual’s declared income required professional qualification.