Budget Proposals 2017/2018: Short payment recovery without show cause against the Constitution

FPCCI11

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has said that short paid sales tax recovery without issuing show cause notice is against the Constitution of Pakistan.
In its budget recommendations for 2017/2018, the FPCCI said that the payment of tax less than the tax indicated in the return is recoverable from registered person without giving him a show cause notice in terms of section 11-A of Sales Tax Act, 1990.
Interestingly, in the existing electronic sales tax filing system there is no provision for short payment. The powers given under 11-A are thus superfluous and unnecessary. There are judgment of the higher courts also against this provision of law.
“The provision is also in direct contradiction of Article 10-A of the Constitution of Pakistan,” the FPCCI said.
The FPCCI said that on the one hand, government is bent upon curtailing the discretionary powers of tax officials to the minimum level whereas on the other hand government is taking measures to enhance their discretionary powers. “It is entirely in contrast to the government policy,” it added.
Therefore, the FPCCI recommended that Section 11A should be omitted / deleted so that no action may be taken without issuance of show cause notice.

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