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September 17, 2020

Income support levy: LHC suspends FBR notice to Maryam

National

September 17, 2020

LAHORE: The Lahore High Court on Wednesday suspended the operation of a notice issued by the Inland Revenue Department of the Federal Board of Revenue (FBR) to PML-N Vice President Maryam Nawaz for recovery of income support levy.

Maryam, through her counsel, moved an appeal assailing an LHC single bench’s verdict regarding income support levy, citing the FBR and other relevant officials as respondents. The appellant stated that she has been served a notice by the FBR for recovery of Rs 657,000 income support levy despite the fact that she had paid all taxes and requested the court to declare it illegal.

Last year in May, the LHC had disposed of a petition filed by the PML-N vice president against the Federal Board of Revenue’s (FBR) notice for recovery of income support levy. Justice Abid Aziz Sheikh had directed her to file an appeal challenging a single bench’s verdict in this regard.

Maryam’s lawyer contended before the court that the recovery of income support levy was violation of the Constitution. It is up to the provincial Social Welfare Department to work towards the public welfare and that the Inland Revenue Department lacked authority to impose and recover a tax in the name of social protection after the passage of the 18th Constitutional Amendment, he added.

The counsel said his client had been asked to pay income support levy on her assets worth more than Rs 317 million and demanded that the impugned notice be declared unlawful. He pointed out that the tax was an amount recovered by the government to meet its public welfare targets. Social welfare is a provincial subject under the 18th Amendment of the Constitution, he added.

The appellant argued that the federal government does not have the authority to pass any legislation on social welfare of the public at large. After the 18th Amendment, the right to legislate about social welfare issues has been devolved to provinces and that if any such legislation is to be passed, it is within the domain of the provincial legislature, he added. The appellant pleaded with the court to declare recovery of the income support levy by the Inland Revenue Department void.

After hearing preliminary arguments, the bench comprising Justice Ameer Bhatti and Justice Atir Mehmood issued a stay order against the impugned notice and directed the Federal Board of Revenue (FBR) and others to submit their replies.