The Federal Board of Revenue (FBR) is developing a dedicated mechanism to process refunds of tax collected under Section 7E of the Income Tax Ordinance following a judgment by the Federal Constitutional Court, it emerged during a meeting between the FBR and the Karachi Tax Bar Association (KTBA). A KTBA delegation, led by its President Mehmood Bikiya, met FBR Chairman Rashid Mehmood Langrial in Karachi on Wednesday and discussed income tax return filing, Section 7E refunds, digitalisation, e-invoicing, faceless audits and taxpayer facilitation.
The FBR informed the meeting that approximately 2.2 million income tax returns had been filed by September 9, compared with 1.724 million during the corresponding period last year.The meeting was told that a dedicated mechanism was being developed to ensure the timely processing of eligible Section 7E refund claims. The FBR would issue appropriate instructions for priority processing of such claims. The KTBA also raised technical problems faced by taxpayers while filing returns through the IRIS portal.
Both sides agreed to continue coordination with Pakistan Revenue Automation Limited (PRAL) to resolve technical issues and ensure smooth filing. The association welcomed the FBR's digitalisation initiatives, including e-invoicing, but stressed the need for greater taxpayer awareness and facilitation. It also requested that penal action initiated by field formations against certain service-sector businesses be examined on case-by-case basis under the applicable law.
The meeting also discussed the proposed introduction of faceless assessments and artificial intelligence-based assessment and monitoring. The KTBA recommended a phased transition to the new assessment regime to minimise inconvenience and allow taxpayers to prepare for the changes. The FBR sought the KTBA's support in creating awareness about the Small Shopkeeper Scheme and encouraging compliance.
The association assured the board of its cooperation in promoting taxpayer awareness and facilitating compliance.Both sides agreed to maintain regular dialogue and strengthen institutional coordination to improve tax administration, taxpayer facilitation and voluntary compliance.