Meeting of the Federal Tax Ombudsman’s Advisory Committee

Islamabad: A meeting of the Federal Tax Ombudsman’s (FTO) Advisory Committee was held at Federal Tax Ombudsman’s office today. Finance Minister, Dr. Hafeez Sheikh was present at the occasion. A comprehensive and detailed presentation was given by Federal Tax Ombudsman, Dr. Shoaib Suddal, covering the historical perspective of FTO, role of Ombudsman, vision and mission, salient features of FTO ordinance 2000, annual performance report 2009 and 2010 and concerns and challenges to FTO.

In his address, Finance Minister praised the role of FTO and stated that FTO can play a very crucial role as a watchdog in developing taxpayer confidence and curbing the malpractices in FBR. He stressed that FBR should bring into use modern technology and mechanism to measure the results should be installed, only then would we be able to achieve goals.

On elaborating upon the efforts carried out at FBR level, he stated as the largest number of complaints were against sales tax refunds so a Sales Tax Refund System has been adopted through which 50,000 cheques worth Rs. 44 billion have been issued during Sept-Jun period of 2009-10 as compared to 15,000 cheques worth Rs. 20 billion in the same time period last year. The refund claims are processed within 48 hours and all the cheques issued within 7 working days.

Regarding increasing the tax base, he stated that 700,000 new taxpayers would be brought in tax net this year, which is currently half a million. Model adopted in this budget includes abolishment of taxes which are acting as multiplicity and reduction of sales tax from 17% to 16%. Finance Minister ensured full cooperation to FTO in order to address peoples’ grievances so that enthusiasm amongst taxpayers can be increased.

Earlier, FTO briefed the advisory committee on the role of Ombudsman’s Office. He stated that the FTO has addressed all the pending complaints of taxpayers from year 2005 to 2008 by 31st December, 2009. He said all pending complaints of taxpayers pertaining to 2009 have been decided by 31st March, 2010. 805 complaints of systematic nature, which were pending for four years have been decided under suo moto notice.

400 cases involving Sales Tax refund worth Rs.180 billion have been settled under suo moto notice. He added that average time taken for complaint disposal in 2009 was 117 days, in 2010 it was 67 days, and the target of year 2011 is 60 days. Upon highlighting challenges and concerns, FTO stated that FBR’s inadequate investigative capacity, lack of public awareness and limited outreach are the foremost problems, which are hindering progress in addressing the grievances of the taxpayers.

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