‘Personal data may be misused in new online tax system’

KARACHI: The secrecy of salaried persons’ information is at risk following the requirement of filing of combined data of salaried and non-salaried persons by an organisation in the online portal of the Federal Board of Revenue (FBR), tax practitioners said on Thursday.
The Karachi Tax Bar Association (KTBA), in a communication sent to the chairman of FBR, said taxpayers were previously allowed to file separate statements for salaried persons and non-salaried persons in the old e-portal system.
“The latest e-portal that is IRIS (Integrated Risk Information System) does not have such feature,” it added.
The bar said the rationale behind the separate filing requirement was to ensure that the salary data of employees was kept confidential. Earlier, human resource department of a company fed statements for salaried persons and the finance department fed data related to non-salaried persons.
Now, “the requirement of filing of a single statement put the data secrecy at risk,” it said.
The data, it added, may be shared with multiple departments within an organisation, which can be misused anytime.
The tax bar said various users in a company had different level of rights to create user ID at previous e-portal system. For the purpose, FBR had allotted a Master ID for the company and allowed the company to create sub-accounts on the portal with restricted permissions to prepare, verify or submit data.
“This system is missing in the IRIS and now access is only permissible through Master ID and password. The non-availability of said feature in IRIS is creating problems for large organisations in delegating and segregation of duties,” the bar said.
The tax practitioners said in the latest system, an employer is required to feed data of tax withheld of an employee, who should have national tax number.
On the other hand, the employer is required to share details of all employees whether or not they have taxable income.
“This requirement restricts the employer to report the below taxable salaried persons where no tax deduction is required,” the bar said. It suggested that the FBR should allow feeding of CNIC number for filing data of employees instead of NTN.
The CNIC should also be available for non-salaried persons, it is advised.
The KTBA said the IRIS system is not accepting multiple data sheets. This is creating problems for those organisations that have more than one branch and are not able to file each data sheet for a branch.
“The consolidated data of an organisation requires sufficient time, which will delay the filing of withholding tax statements,” the bar said.
It said the latest online system is incorrectly calculating tax for filers and non-filers by categorising the persons according to the current active taxpayers list.
“The option to feed tax rate should be left open for a withholding agent to avoid hassles,” the bar said.
It also raised an issue of uploading payment challans of withheld tax on the online portal.
The tax practitioners demanded FBR to allow filing of withholding tax statement on the old system to ensure compliance. They said two months have already lapsed due to flaws in the online system.
The tax bar said if it is not possible to restore the old system then time should be extended for one month for filing monthly withholding statements, which expired on October 8.