People have no trust on tax machinery: FTO


KARACHI: People have no trust on tax machinery so they do not want to come into tax net, Mushtaq Ahmad Sukhera, Federal Tax Ombudsman said on Friday.
While talking with members of value added sector, the FTO said that there was trust gap between FBR and taxpayers, which should be reduced through change in policies.
He said that our Tax to GDP ratio is lower than even African countries while the neighboring countries, Tax to GDP ratio is much higher.
The Audit Notices issued by FBR are creating troubles for the taxpayers who have to divert their energies towards responding to these notices instead of focusing on export matters and added that FTO office will take every step in accordance with law to facilitate exporters by resolving their genuine tax related issues.
Regarding Withholding Tax, the FTO said that it is the easiest tool to collect advance tax and instead of this, FBR should improve its tax collection system and broaden the tax net instead of squeezing the existing taxpayers. On a query regarding Further Tax, the FTO assured to take up the matter from his platform.
On the matter of pending applications of Zero-rating of utilities, the FTO said that it is unfortunate that genuine exporters having good profile & history with FBR also suffer which is due to inefficiency of the system. The FTO office will also extend help to exporters if the Recovery Notices are not received by them but amounts deducted from their bank accounts.
Answering to a query, the honorable FTO stated that on average approx. 2,000 complaints are submitted to FTO office annually. Informal complaints are not included in this which we try to resolve through correspondence.
“Resolving the tax matters of exporters shall be a service to the nation. We will use powers of FTO office to resolve their tax issues and FBR maladministration and if law permits, will also take suo moto action.”
Addressing the garments exporters, FTO said that on all important matters, we will take input of exporters who are earning valuable foreign exchange for the country which is much needed to narrow the trade deficit. Declining trend in overall exports in last 4 fours years, is clear manifestation that we are not on the right direction due to which our exports fell from USD 25 billion in the year 2013 to USD 20.45 billion in 2017. If exporters are not strengthened, the exports will not increase.
Earlier, Jawed Bilwani, Chairman of Pakistan Apparel Forum welcomed the Chief Guest and other participants and highlighted the tax related issues of exporters.
He said that the pending refunds of exporters with the FBR is the main factor behind slowdown of exports which led to lower production and closure of a number of exporting industries which has finally resulted in drop of textile exports. Therefore the value-added textile exporters associations demand the FTO to take Suo Moto Notice against the excessive delays in refunds by FBR and help in release of all long pending refunds of exporters.