Budget Proposals 2017/2018: FBR officials grossly misuse powers in determining sales tax payment

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has said that powers of Inland Revenue officers have been grossly misused in determining the payment of tax against a trade transaction.
In its budget proposals for 2017/2018, the FPCCI said that Section 8-A of Sales Tax Act, 1990 provides joint and several tax liability in case tax is not deposited within government exchequer. The provisions were grossly misused by the field formation, who in past prosecute entire supply chain under the provisions of section 8-A.
The section has resulted in abuse of powers, creates fear, uncertainty and panic among legitimate business.
Further it clashes with Section 3 of the Act, which clearly states that payment of due sales tax is the sole responsibility of supplier.
The FPCCI proposed that if supplier is an active taxpayer at the time of transaction then the sole responsibility should lie on supplier.
The buyer should not be made liable or responsible for any default of supplier.
Now after introduction of STRIVE the provision already lacks its legal sanctity as well, the FPCCI said.

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