ISLAMABAD: The announcement made by Finance Minister Ishaq Dar regarding the amendment in Income Tax Ordinance (ITO) in terms of direct withdrawal of amount from the bank accounts of companies by Federal Board of Revenue (FBR) was tantamount to throw dust in the eyes of people, traders said on Thursday.
They said this amendment would be of no use for the traders and companies, as the powers for withdrawal of income tax directly from bank account still rest with FBR. As the appellate commissioner works under the FBR chairman, therefore, it was easy for FBR to influence the decisions in its favour, they added.
Different government and private departments have filed complaints against the FBR, stating that it was causing loss of billion of rupees to them by misusing the powers laid down in Income Tax Ordinance on withdrawal of income tax amount directly from their bank accounts.
A reliable source privy to this scribe said that government, while taking notice of these complaints, decided to introduce amendment in Section 140 of FBR Income Tax Ordinance 2001, adding that the finance minister had also made an announcement in this regard someday back in the National Assembly. Dar said in his speech that FBR would not withdraw the income tax amount directly from the bank accounts of the departments unless their appeal was decided, he added.
It was spelt out in the amendment of Income Tax Ordinance that FBR would not be entitled to withdraw income tax amount directly from the bank accounts of companies till the decision of the appeal by FBR commissioner, but FBR would be authorised to withdraw the income tax amount from bank accounts before the decision of appeal from authorities higher than appellate commissioner was made.
The traders’ community urged the government to keep them onboard with regard to withdrawal of tax amount directly from bank accounts of the companies by FBR.
They held that the proposed amendment amounts to throwing dust in the eyes of people because FBR would wait only for the decision of the appeal by its own appellate commissioner. This way the powers of FBR would remain unchanged, they lamented.
According to traders, FBR would get the decision of appeal in its own favour from the commissioner and withdraw the income tax amount from the bank accounts of companies directly.
The finance minister announced to bring amendment but he kept the powers of FBR intact, they said, adding that Oil and Gas Development Company Limited (OGDCL) has lodged complaints on several occasions on this matter that FBR has withdrawn billion of rupees from its bank accounts without bringing it into notice.
According to OGDCL statistics, the amount was withdrawn twice from its bank accounts directly and in these two transactions, amount ranging between Rs 1.5 billion and Rs 2.5 billon was withdrawn from its accounts.