Power to suspend sales tax registration centralized

FBR Chairman Shabbar Zaidi has asked tax officers to seek his prior approval before the suspension of sales tax registration of taxpayers. Once a sales tax registration is suspended, the taxpayer concerned is unable to claim credit of input tax. Currently, a tax officer can suspend sales tax registration of a tax defaulter with prior approval of an income tax commissioner as required under the sales tax act. However, the FBR did not consider making the chief commissioners accountable for any possible misuse of the power. Instead of making the chief commissioners responsible for any possible misuse of the power by a tax officer, Mr Zaidi has centralized the power of approval regarding suspension of sales tax registration of tax defaulters. The FBR chairman told a news conference that he took the decision to facilitate businessmen. He said more facilitation measures would be announced in the budget. He further directed the senior officers that there would be no raid on premises of any existing taxpayer without prior approval of IR (Operations) member and the FBR chairman himself.