Bills crossing Rs25,000: Power consumers forced to pay 7.5 per cent tax

LAHORE: Power consumers have been blanket invoiced with a 7.5 per cent tax on their bills crossing Rs25,000, a levy that was meant only for users not filing their returns. Even consumers who have registered themselves with the electricity companies like LESCO, Karachi Electric, IESCO as filers will have to cough up 7.5 per cent more amount as income tax than they should have been billed.

The federal government levied a new income tax on non-filers of tax on utilities bills above than Rs25,000 per month. However, the FBR has made it clear that active taxpayers are exempted from this tax as the tax was levied to encourage non-filers to file their income tax returns regularly. But the electricity companies ignore the instructions of the FBR and started applying the tax to every consumer’s monthly bill that crossed the limit of Rs25,000. The electricity providing companies, instead of synchronizing its customers data with the FBR-provided data, are asking customers to visit their respective offices and get their status updated in order to avoid levying of the new income tax.

Further, rather than correcting the wrong income tax levied bills, officials of different companies are blaming the FBR and suggesting to customers to approach the board. On the other hand, FBR officials said that they have nothing to do with implementation of this income tax on domestic consumers, except giving access of active taxpayers to utilities companies.

The LESCO had required its filing consumers to register with it through www.mnr.pitc.com.pk or 8118. The active taxpayers are still getting the tax in their bills despite filing with the website or sending SMS on the short code.

Officials of the FBR, talking to The News, said that the discrepancy in imposition of the newly-levied income tax on active taxpayers was the responsibility of concerned utility company. Since the FBR has provided access to active taxpayers’ details to utilities companies, now the companies are responsible to synchronize the customer data with the FBR data. “There is no human involvement in it as it is system-to-system integration,” the tax official said.

However, the complaints of electricity companies’ customers are almost the same across the country irrespective of LESCO, IESCO, Karachi Electric and others.

Waqar and Fawad, two different consumers of LESCO, complained that income tax was levied on them in their monthly bill. The concerned Revenue Officers (ROs) of LESCO’s two different divisions refused to correct and receive the applications of correction as well. Rather, the ROs asked them to approach the FBR. On the other hand, FBR officials of the concerned RTOs said that this would be corrected by the LESCO.

Waqar also lodged a complaint on the PM’s Citizen Portal and is waiting for relief. Talking to The News, he said, “LESCO revenue officer I spoke to, sharing with him the FBR certificate verifying me as an active filer, remained non-committal and said Lesco gets the data from the FBR and it was for the FBR to tax or not to tax somebody. He was not even ready to commit himself to correcting the Lesco record for the next bill.”

LESCO Chief Executive Ch Amin said that the FBR did not share the data of active taxpayers with the company. Further, no access was granted to the FBR filers’ data. However, he said that concerned Revenue Officers (RO) were already instructed to get applications of active taxpayers and correct their bills accordingly. Contrary to the CEO’s claims, the ROs of the LESCO are refusing to address the income tax levy issue to active taxpayers, saying they have no authority and jurisdiction to remove the tax as it was imposed by the FBR.

On a question how the RO will correct the bills when the FBR did not provide access to taxpayers’ data, he said that the RO has access to the data and they can verify that the applicant is an active taxpayer and filer or not.

Further, on a question that why a taxpayer approaches the LESCO for correction of bill and income tax applied to them, he said there was no other option with LESCO other than this. “We have told the FBR it was not the work of utility companies to calculate and collect tax from the utilities users,” he said adding that the income tax was applied in two batches and those applied with tax in the first batch was now corrected and their data was updated with the LESCO. So will be the practice with the second batch on which this income tax was passed on this month. Those approaching LESCO and submitting the application on the status of taxpaying would be updated and treated accordingly, he said. On a question that if some active taxpayer could not approach LESCO to correct the income tax levy on the bill, he said they don’t have any other mechanism to address the issue.

Ch Amin insisted that the utilities companies had not agreed to implement the levy of this income tax as they already have a number of issues to handle and taxing was not the forte of these companies. However, the government has imposed it on them, he added.

A spokesperson of the KE admitted that the active taxpayer customers were facing issues regarding the imposition of income tax. However, the KE updated the customers via its digital media platforms including website, social media handles and KE Live App when the government made the announcement of levying the income tax.

“All these platforms have very clear intimation about the withholding tax to be applied in utility bills, in written as well as in visual form. In order to facilitate the KE customers, we have also introduced a simple form whereby customers intending to change their CNIC details may upload their information for further processing.

In case no discrepancy is found, a confirmation SMS about change of record is shared with the customers.”