NA passes Tax Laws (Amend) bill for swift disposal of Rs2.7tr appeals in tax cases

ISLAMABAD: The National Assembly (NA) passed the Tax Laws (Amendment) Bill, 2024 on Monday to expedite the disposal of appeals in tax liability cases to the tune of Rs2.7 trillion, which are pending with commissioners of Inland Revenue, inland revenue tribunals, high courts and apex court.

“After holding meetings with all stakeholders, a decision has been reached on some basic reforms,” Minister for Law and Justice Senator Azam Nazir Tarar said as the mover of the bill. The bill was okayed by the House amid protest from the opposition members, who pointed out the lack of quorum during consideration of the bill. However, the House was found in order on both occasions.

The bill was okayed while suspending rules of the assembly for consideration of the same by the House without approval of the finance standing committee, which presently does not exist.

The opposition leader, Omar Ayub Khan, Ali Muhammad Khan and other opposition members opposed the legislation, saying the bill should have been taken up at the finance committee level for detailed discussion with stakeholders and tax experts.

Speaker Sardar Ayaz Sadiq said consensus on chairmanship of standing committees had not been reached so far despite efforts. The law minister said as per reforms, the appeals of tax liabilities up to Rs20 million would be heard by commissioner Inland Revenue, while Inland Revenue Tribunal will hear appeals of tax liabilities of amount above Rs20 million. The appeals received from forums would be heard by high courts.

He said as per reforms, there would be no recovery mechanism available for 30 days by the FBR from accounts following decisions by tribunal. Previously, there was 90-day time and the FBR used to start recoveries from accounts, which created problems.

The statement of objects and reasons of the bill said the House passed the amended bill, which aimed to give legislative effect to the taxation proposals of the federal government to liquidate a significant number of appeals pending before commissioner IR (Appeals) and Appellate Tribunals as ATIR is the last fact-finding authority in the appellate hierarchy provided in fiscal statutes.

Over the years, and for various reasons, including arbitrary constitution of benches, inadequate number of benches, delay in fixation of cases and disposal of appeals, a substantial amount of revenue to the tune of over Rs2 trillion is held up in litigation before the ATIR. Earlier, a meeting of Senate Special Committee to consider and make recommendations on the Money Bill, the Tax Laws (Amendment) Bill, 2024, was held at the Parliament House.

Attorney General for Pakistan Mansoor Awan briefed the committee that the primary objective of the Money Bill was to create a dedicated ‘Director General Law’ position within the FBR for timely disposal of tax litigation pending before commissioner Inland Revenue and Appellate Tribunals.