FBR Portal Malfunction Disrupts Businesses in Pakistan

Pakistan's business community is facing a major hurdle due to malfunctions within the Federal Board of Revenue's (FBR) portal. This disruption is causing registered sales tax filers to be denied input tax adjustments.

Implementation of SRO 350 Creates Initial Hurdles

The issue stems from the recent implementation of SRO 350 in March 2024. This statutory regulatory order mandates that all submitted sales tax returns are initially treated as provisional. However, the situation has become more complex.

Portal Denies Input Tax Claims for All Vendors

The core problem lies in the FBR's portal functionality. It appears to be malfunctioning and indiscriminately disallowing input tax claims for all vendors, regardless of their return submission status. This unexpected glitch has resulted in a cascade of administrative headaches. Businesses are now struggling to verify and re-verify the return submissions of their suppliers to secure their input tax claims.

Technical Glitch or Deliberate Restriction?

Tax professionals are divided on the cause of the issue. Some suspect a significant technical error, while others believe it might be a deliberate restriction imposed by the FBR. The provisional nature of returns, combined with this glitch, has created a wave of uncertainty and redundant follow-up processes between businesses, further complicating the already tedious tax filing process.

Tajir Dost Scheme Faces Challenges

This situation poses a serious challenge to the FBR's recently launched Tajir Dost Scheme. This initiative aims to integrate undocumented traders into the formal economy. The problematic handling of tax adjustments for existing businesses raises concerns about the effectiveness of the government's strategy to widen the tax net.

Businesses Feel Neglected, Seek Urgent Resolution

"As long as these glitches persist, it is highly unlikely that traders outside the tax system will feel encouraged to register," noted a senior tax consultant, who preferred to remain anonymous. "The existing taxpayers feel neglected, almost like stepchildren, which certainly doesn't paint a welcoming picture for potential registrants."

Adding to the frustration is the reported lack of support from the FBR. Businesses facing these issues have received minimal aid or clarity on resolving them. This has led to increased operational costs and hindered financial planning for numerous businesses.

Low Registration Numbers for Tajir Dost Scheme

Since the scheme's launch, only about 200 traders have reportedly registered. This lukewarm response can be attributed partly to the current complications experienced by those already within the system. This highlights a significant trust and efficiency gap in the administrative processes of the FBR.

The business community is demanding an urgent and transparent resolution to these issues. Clear communication and swift rectification of the portal's functionalities are seen as crucial to restoring confidence among Pakistan's taxed sector and successfully integrating more traders into the formal economy.

FBR's Silence Raises Concerns

As of now, the FBR has not issued an official response to the allegations of technical difficulties within the portal. The continuation of these problems could have long-term detrimental effects on the country's tax administration and its relationship with the business community, potentially hampering economic growth and tax compliance initiatives in the future.

This article was published at FBR Portal Glitch Disrupts Businesses in Pakistan