Federal Board of Revenue (FBR) Chairperson Nosheen Javed Amjad on Monday directed chief commissioners of large taxpayer units and regional tax offices (RTOs) to update lists of income tax refund claimants on emergency basis.

The FBR chairperson held video conference with the chief commissioners here on Monday to obtain feedback on payment of income tax refunds.

The FBR has received numerous complaints from all over the country about the delay in payment of income tax refunds by the field formations.

There was a common question of taxpayers, tax experts, chartered accountants, tax lawyers and tax advisors that when the FBR had announced lists for issuance of income tax refunds, then why the field formations are persistently delaying the issue?

On the other hand, the field formations responded that they have to follow the due verification process and cannot bypass the process as laid down in the law. Tax authorities decided to hold an urgent meeting with the chief commissioners to have an update on the payment of income tax refunds.

During the video conference, it has been decided that the field formations would immediately update lists of income tax refund without any further delay.

Prior to this, list of taxpayers to be issued income tax refunds were finalised, but the verification and processing took time.

Taking into account the delays in payments of income tax refunds, Nosheen Javed directed chief commissioners to deal with the issue on top priority basis, and update the lists without further delay. The purpose of whole exercise is to ensure prompt payment of admissible refunds.

Recently, the FBR had expressed serious displeasure over the deferment of genuine sales tax refund claims of exporters by field formations, and directed the chief commissioners to give explainable reasons with evidence to justify deferment of valid claims of the business community.

According to the instructions to chief commissioners, the FBR has warned field formations that the wrong deferment of sales tax refund claims will be indicated in the performance evaluation report (PER) of the concerned tax officers.

Last month, the tax authorities stated that the FBR had also processed income tax refunds and even taxpayers were unaware that they were going to get income tax refunds directly into their bank accounts.

Therefore, these taxpayers have not updated their IBAN bank accounts as they are not aware that their refunds have been processed.

It has been decided to stop the practice of issuance of refund cheques forthwith from field formations, and directly credit the amount cheques of income tax refunds into the bank accounts of the taxpayers.

For this purpose, the IBAN bank accounts of the taxpayers are needed to be updated in their IRIS profiles. The income tax refunds have been divided into two categories/slabs. The first category/slab of income tax refunds is between Rs1 million to Rs5 million.

An amount of Rs2.184 billion income tax refunds has been processed where IBAN has been updated and would be directly credited into the bank accounts of the taxpayers. The second category/slab of income tax refunds ranges between Rs5 million to Rs50 million. The FBR has finalised the amount of Rs8 billion, which would be released to the taxpayers. An amount of Rs700 million involves, where the IBAN has not been updated.

Overall, an amount of around Rs13 billion is ready to be issued to around 10,000 taxpayers in both the categories of income tax refunds. The FBR has requested around 6,000 taxpayers to update their IBAN for receiving income tax refunds of Rs1 billion.

These 6,000 persons have not updated their IBAN.

In the given bank account details area in the system, IBAN detail row is added wherein taxpayers are required to add their complete bank's IBAN number of same bank account whose details are already available in IRIS profile to receive sales tax, the FED and income tax refund cheques.

Copyright Business Recorder, 2020