business
Tuesday Oct 12 2021
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FBR will no longer warn taxpayers before freezing their accounts

A representational image. Photo: File
A representational image. Photo: File

  • Previously, FBR had to inform taxpayers 24 hours prior to freezing their bank account. 
  • "Do taxpayers have any rights?" wonders president Karachi Tax Bar Association.
  • Business community says move will prove to be a setback for ease of doing business. 


ISLAMABAD: The Federal Board of Revenue (FBR) has withdrawn its clause that directed the Board to warn taxpayers 24 hours prior to freezing their accounts. 

Needless to say, the business community is not happy over the development and has termed it as a "harassment" of filers, as per a report in The News

Back in the day, former FBR chairman Shabbar Zaidi had made it mandatory for the tax collectors to intimate defaulters before suspending their account, keeping the FBR chairperson in the loop.

“I am further directed to state that in order to implement the law in its true spirit and to re-vest the power vested in the institution of the Commissioners viz-a-viz action under Section 140 of the Income Tax Ordinance, 2001, the instructions referred supra are hereby withdrawn ab-initio,” said Hammad Hussain Jaffri, Secretary Inland Revenue Operations FBR, in the official notification on Monday.

"Do taxpayers have any rights?" wondered President Karachi Tax Bar Association (KTBA) Muhammad Zeeshan Merchant, saying that those already filing income tax returns and paying taxes will be at a disadvantage due to the latest development. 

Merchant said it would only add to the misery of the taxpayers.

"It's very sad. Instead of gaining their confidence, the tax authority is disillusioning the taxpayers,” he added. 

He wondered why the Board does not go after people who were non-filers or evading taxes and as a result, increase the tax net. "FBR again chooses to burden the people who are already in the tax net," he stated. 

Karachi Chamber of Commerce and Industries (KCCI) President Mohammad Idrees said the government had been claiming to improve ease of doing business for investors. However, he said the move to revoke this clause would have negative repercussions for the business community. 

He said the move will be a setback for ease of doing business, adding that it will "certainly shatter the trust and confidence of the business community."

Former chairman FBR Shabbar Zaidi spoke to The News, expressing disappointment over the decision. He said the clause had been introduced to ensure taxpayers were not harassed.  

"I am personally sorry to hear the withdrawal of the first instruction issued when I joined as chairman FBR," said Zaidi. "[There should be] no freezing of bank accounts without intimation and approval from chairman FBR. It was a major relief to taxpayers. I urge the prime minister, finance minister, and chairman FBR to reinstate it [the withdrawn clause]," Zaidi added.