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Tuesday April 16, 2024

FBR clears Rs65bn sales tax refunds

The major export-oriented sectors claim that the outstanding GST refunds were hovering around Rs500-600 billion

By Mehtab Haider
March 05, 2024
The Federal Board of Revenue (FBR) office. — APP/File
The Federal Board of Revenue (FBR) office. — APP/File

ISLAMABAD: The Federal Board of Revenue (FBR) has cleared verified refund claims of Rs65 billion under directives from the prime minister.

The major export-oriented sectors claim that the outstanding GST refunds were hovering around Rs500-600 billion, but the FBR has so far cleared only verified refunds, which remained stuck owing to the inefficiency of the tax system.

Sources said that the sales tax refunds were also being misused in the form of fake or flying invoices, so there are always arguments in favour and opposition to the release of refunds. However, the utilisation of an effective IT system and effective enforcement could plug the leak of fake and flying invoices for GST refunds.

This scribe sent out a question to FBR high-ups Monday to ascertain the exact amount of the stuck sales tax refunds. They replied that “all outstanding refunds have been issued, which were around Rs65 billion. Balances are only those that have been rejected by the system, and the taxpayers have to get their claims verified from the field formations,” they added.

However, according to an official announcement Monday, the FBR has disbursed all verified refund claims up to March 3, 2024, to exporters, this step will help exporters improve the liquidity crunch and boost the country’s exports.

The FBR issues all outstanding refunds as of March 3, 2024, to exporters, amounting to Rs65 billion. Trade bodies and export-oriented sectors have welcomed the move and said it will lead to economic prosperity and the creation of more jobs in the textile industry.