Daily Times

Tax season starts in Pakistan from July to September of every year, in which taxpayers fulfill their national obligation of voluntarily filing their annual income tax returns and statements of assets and liabilities, declaring their net annual income and wealth on FBR portal, to be assessed by FBR in the following assessment year. By fulfilling this national obligation of filing annual income tax return and wealth statement makes taxpayers entitled to fulfillment of their certain human rights by the state.

Taxpayers are major stakeholder in collection of revenue in national exchequer by the state’s agencies/departments/revenue authorities. Taxpayers contribute in the state’s revenue generation process in the form of payment of taxes, charges, cess, duties and levies etc. Govt. spend the taxpayers’ money in implementation of its development projects, programs, welfare activities and services for its citizens, such as education, health, security measures, law enforcement, defence and transportation systems etc. All these factors contribute in the smooth functioning and development of the state.

It is the state’s responsibility to ensure that resident and non-resident taxpayers’ rights and obligations are exercised in true letter and spirit.

Because of taxpayers’ contribution in the national exchequer, they are entitled to certain rights and privileges to be guaranteed by the state through legislation. Likewise, taxpayers have certain obligations to act as a responsible person/citizen and fulfil their obligations of paying the due taxes in-time and manage their tax matters diligently.

The basic taxpayers’ human rights that must be protected and fulfilled by the state’s agencies/departments/revenue authorities inter alia are as under;

* The right to be treated fairly, with respect and dignity during handling of tax matters of taxpayers.

* The right to be informed, assisted and heard about tax obligations.

* The right to be educated and facilitated in tax matters.

* The right to access information about tax documents/records.

* The right to file appeal/review against a tax assessment order.

* The right to pay no more than the due amount of tax.

* The right to claim due exemptions, concessions and rebates in the taxes.

* The right to fair trial and adoption of due process of law during the course of any tax proceedings undertaken by revenue authorities to determine the tax liability.

* The right to issue the due refund of taxes within a prescribed time limit.

* The right to consult and be represented by a legal/tax practitioner of his choice.

* The right to confidentiality, privacy, and certainty of taxpayer’s information/record/declarations.

* The right to life, survival and development of taxpayer.

Rights of taxpayers also confer certain obligations upon taxpayers to be fulfilled. These obligations inter alia are as under;

* The obligation to register as a taxpayer in accordance with the procedure laid down in law and regularly update any changes in his taxpayer profile accordingly.

* The obligation to filing of tax returns in time.

* The obligation to pay due taxes in full and in time.

* The obligation to maintain accounts, accounting documents, registers and other relevant documents in accordance with procedures described in law. Also, keep record of his tax documents and transactions.

* The obligation to provide accurate information and documents in time to tax authorities.

* The obligation to requesting required information from the tax authorities.

* The obligation to familiarize oneself with the basics of taxation laws/policies. Taxation laws are amended every day, so it is important to stay informed about the latest changes in these laws.

* The obligation to retain the services of a tax practitioner/lawyer and to pay their full remunerations. A tax practitioner/lawyer can assist the taxpayer in understanding his tax obligations and rights.

* The obligation to be honest and co-operative in his taxation matters.

* The obligation to be aware of tax fraud, abuse and scam. Immediately report such malicious activity to tax authorities and law enforcement agencies.

The above taxpayers’ rights and obligations are the integral part of the taxation system of any state and without maintaining the balance on taxpayers’ rights and obligations, taxation system of the state can not function in efficient, effective and transparent manner. It is therefore the responsibility of the state to ensure that resident and non-resident taxpayers’ rights and obligations are exercised in true letter and spirit by the state’s agencies/departments/revenue authorities.

Many states have developed Taxpayers’ Charters or Taxpayers’ Bills of Rights, which declare the basic rights and obligations of taxpayers in relation to their tax affairs, and provide such information publicly accessible and understandable. In Pakistan, FBR’s FATE wing has published the Taxpayers’ Charter document. This document describes about the behaviours expected from state’s tax collection officials and taxpayers in discharge of their obligations. Although, the Taxpayers’ Charter published by the FBR categorically describes the rights and obligations of taxpayers in Pakistan, but in practice these rights and obligations are not fulfilled in the field. Both the state’s revenue authorities and taxpayers are negligent in fulfilment of their tax collection/paying obligations, which are further reinforced by a lack of political stability and will, and investment in taxation system. This ultimately results in inadequate tax enforcement, monetary loss to national exchequer, weakening of economy and violation of taxpayers’ rights/obligations.

FBR’s Taxpayers’ Charter generally does not provide additional rights or obligations other than those contained in relevant tax legislation. In fact, it is a facilitation guide for the proper implementation of taxation laws of the state and not an exclusive law to overseeing and ensuring taxpayer’s rights and obligations in relation to taxation system. Some states have enacted the Taxpayers’ Charters or Bills of Rights either as a part of their taxation laws or as an exclusive legislation, but no such kind of legislation has been enacted so far in Pakistan. It is therefore recommended that federal govt. must enact an exclusive law entitled as ‘Taxpayers’ Rights and Obligations Protection Act’ in order to safeguard taxpayers from infringement of their rights/obligations. The proposed law should clearly declare and administer the rights and obligations of taxpayers, prescribe privileges/awards for those who have paid due or high amount of taxes and penalties for the violators of taxpayers’ rights/obligations. This act of govt. will help significantly towards overhauling of an ineffective taxation system, broadening of active taxpayer database, rising of Tax-to-GDP ratio, prevention of tax theft and malpractice of officials, payment of due taxes in treasury and for advancement of the country’s dilapidated economy.

The writer is an Advocate High Court & Human Rights Activist. He can be reached at adv.wajahat.ali@gmail.com and tweets @Adv_WajahatAli