Revenue board stops physical monitoring of production facilities

KARACHI: The Federal Board of Revenue (FBR) has decided to stop physical monitoring of production facilities of the taxpayers in the wake of coronavirus spread, sources said on Tuesday.

The FBR recently allowed posting of staff at various production facilities of different sectors to check sales tax evasion. An official at Large Taxpayers Unit Karachi said the staff deputed at different factories has already been asked to report to their respective offices due to lockdown after the spread of coronavirus.

At present, the tax officials are posted at 60 production facilities of different sectors of the economy, the official said. Sources said the FBR posted officials at 30 sugar mills, while, 30 other production facilities belong to tobacco, fertiliser and cement sectors.

The sources said the FBR has powers under section 40B of the Sales Tax Act, 1990 to post an officer of Inland Revenue at a factory premise of a taxpayer to monitor production, sale of taxable goods and the stock position.

The instructions to post officials are approved by the Federal Board of Revenue headquarters. A chief commissioner had the power to post officers at any factory premises prior to July 1, 2019.

The sources said the FBR would also issue notifications instructing tax offices to stop raids and bank attachments for recovery of outstanding taxes till the situation of virus outbreak eases. The sources further said many tax offices stopped proceedings of audit and recovery cases due to shortage of staff and lockdown in many parts of the country.

The sources said the FBR’s working strength of field offices has been reduced to 50 percent. Last week, the Federal Board of Revenue directed tax offices to follow international best practices and policies being pursued by the federal and provincial governments against the COVID-19.

“All field formations are advised to make strategies focusing on cutting down the number of employees by at least 50 percent, initially for the next two weeks and onwards, if

necessary, effective from March 24, 2020, positively,” the FBR said then.

The Federal Board of Revenue also asked head of tax offices that employees above 50 years of age might be allowed to work from their homes except employees whose presence is unavoidable for smooth functioning of the official business. “Field offices are further advised to allow female staff (mothers of children) to work from their homes,” it said.