KARACHI: The number of active taxpayers fell 14 percent to 2.18 million for the 2020 tax year as many return reporters were unable to file returns when they were due, sources said on Monday.
The Federal Board of Revenue (FBR) issued a new Register of Active Taxpayers (ATL) for the 2020 tax year on March 1. The new ATL has 2.18 million names of taxpayers filing returns for the 2020 tax year. However, this figure is less than the 2019 ATL, which carries 2.53 million active taxpayers.
The last date for filing an SPT for the 2020 tax year is December 8, 2020 for business actors, salaried people and companies with a special year that is extended from September 30, 2020. However, for the 2019 tax year this date is extended to February 25, 2020.
The day before, FBR admitted to having received SPT PPh 2.62 million until February 28, 2021. This means that FBR has received 440,000 SPT submitted after maturity or failed to pay additional fees due to appearing at ATL 2020.
FBR introduced the ATL concept through the 2010 Financial Act. Since then people have been allowed to appear on ATL even filing returns after the due date without payment of any additional fees.
The emergence of the taxpayer’s name ensures exemption from withholding taxes on various transactions in addition to a 50 percent reduction in the amount of withholding tax on many other transactions.
However, through an amendment through the Finance Act, 2019 major changes were introduced and reporters who were returned after the due date were refused to appear on ATL.
The appearance of a taxpayer in ATL is related to filing an SPT PPh either with the due date or after payment of additional costs in the event that the SPT is filed after the due date.
The total surcharge according to the Income Tax Act, 2001 is Rs20,000 for companies, Rs10,000 for associations of persons, and Rs1,000 for individuals.
Tax experts say FBR should allow income tax returns filed after the due date without fines and penalties and also without any additional fees to appear on the ATL.
A tax practitioner at the Karachi Tax Lawyers Association said FBR has agreed to waive fines and fines as well as additional fees for people who file their returns after the due date.
However, FBR explained that there had been crackdown on people who had taxable income but did not file an SPT, the tax practitioner added.