ISLAMABAD: Finance Minister Ishaq Dar has ordered the Federal Board of Revenue (FBR) to release by Oct 31 an amount of Rs13 billion involving more than 4,000 sales tax refund payment orders (RPOs) issued up to Aug 31.

Chairing a meeting on Thursday, Mr Dar said the government is aware of liquidity problems being faced by the businessmen and traders community and keeping this fact in view he has given instructions to the FBR for making refund payments.

He said the government had been able to contain the problem of refund pendency despite the increase in taxpayers number and increase in refund payments. “The FBR has been trying to facilitate the businessmen so that they are encouraged to pay their taxes,” he added.

“The refunds shall be paid to all segments and sectors of registered persons.”

As per practice adopted previously, all refund amounts shall be electronically transferred to claimants’ bank accounts through the State Bank of Pakistan. This measure, Mr Dar said, is aimed at enhancing transparency and facilitation and reducing contact between tax collectors and the taxpayers.

FBR has already paid sales tax refunds amounting to Rs27.6bn during this fiscal year. These payments were made in pursuance of the announcement by the finance minister in the budget speech for 2017-18 that taxpayers’ long outstanding demand for payment of refunds will be soon addressed and the sales tax refunds against RPOs issued up to April 30, shall be paid in two stages.

Accordingly, payments against RPOs involving amount up to Rs1m were made on July 15 and for RPOs exceeding Rs1m the payments were made on Aug 8.

Published in Dawn, October 27th, 2017