On complaints of fish exporters, the Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to initiate action against the officers involved in ‘choking’ an export-oriented sector and jeopardising the inflow of foreign exchange, VOS News reported on Monday.
The Ombudsman initiated Own Motion (OM) investigation on allegations – levelled by Pakistan Fisheries Exporters Association – of issuance of multiple notices to fish exporters and demanding bribe to settle those notices, causing harassment and hurting inflow of foreign exchange.
According to an order issued by the FTO, the issuance of illegal notices of income tax/sales tax, unexplainable withdrawals in certain cases and imposition of heavy taxes in some identical cases by Commissioner Zonal, RTO-l Karachi and his team from the exporters of fish, earning foreign exchange for the country causing fear, mental agony and harassment tantamount to maladministration.
The Ombudsman, in its order, stated that the export of fish products mostly to China, Thailand and Middle East countries, is fetching foreign exchange worth $450 million.
“Since the exporters earn foreign exchange to reduce trade deficit, the government has facilitated the exporters by deducting only one percent of export proceeds at source as income tax which is the final tax liability,” it stated.
The order noted the exporters do not have to file any books of accounts except a statement under section 115 (4) of the Ordinance. Even the withholding tax under section 153 of the Ordinance is exempt under clause 45, part IV of Second Schedule to the Ordinance. The GST on exports is zero rated.
“The threatening show cause notices confronting unexplained income and suppressed taxable supply of billions of rupees were withdrawn in shady manners,” it stated, adding that the quality of assessment orders consisting of one page giving a clean chit reflects the corrupt motives for extortion.
The FTO directed FBR to initiate Fact Finding Inquiry proceedings, to be conducted by Directorate General I&I-IR and furnish its report within 60 days to the FBR.
