ISLAMABAD: In response to exporters’ concerns, the Federal Board of Revenue (FBR) has postponed the need that an affidavit be submitted with the sales tax return for a period of one month.
The ruling states that affidavits will not be necessary for returns filed this month for the tax period of September. Following concerns from the Federation of Pakistan Chambers of Commerce and Industry and other prominent exporter associations regarding the condition’s detrimental effects on businesses, a decision was made.
Until October 31st, the stakeholders will submit alternative recommendations to the FBR in an effort to stop the growing problem of fraudulent sales tax returns. The FBR has the authority to alter the affidavit’s details in cases where stakeholders have legitimate concerns.
As exporters do not have access to the multi-tier supply chain, Khurram Mukhtar, the patron-in-chief of the Pakistan Textile Exporters Association, stated that the FBR should do away with the requirement of an affidavit from the CFO. According to him, exporters can only use the FBR system to confirm a supplier’s status and see if they are listed as an active taxpayer. According to him, it makes no sense to hold purchasers accountable for the entire supply chain.
According to Mr. Mukhtar, the government ought to concentrate on establishing a favorable business climate that boosts trade volumes and, in turn, improves tax collection.
“We strongly encourage strict compliance with tax policies and do not support any wrongdoing.” But the government needs to come up with a plan that gets the business community back on board,” he stated.
The FBR did, however, stress that the “affidavit” does not create any new legal obligations and that registered taxpayers should always be aware that filing false returns and concealing sales are crimes under section 33 of the Sales Tax Act 1990. All registered individuals must file returns with great caution in order to avoid financial and legal penalties.
