ISLAMABAD, Sept 16: The tax authorities have retrieved Rs1.418 billion during 2001-02 through audits of income tax cases against Rs1.089 billion over the corresponding year, an increase of 30 per cent.

Official figures showed that the Southern Region, Karachi recovered Rs55.152 million through audits during 2001-02 against Rs18.336 million the previous year, an increase of 200 per cent. And the Central Region, Lahore collected Rs1.309 billion the same year against Rs0.839 billion, showing an increase of 56 per cent. The retrieval of loss from audited matters in the Northern Region, Islamabad, however, declined by 77 per cent to Rs54.318 million during the same period against Rs231.385 million the previous year.

On the other hand, a senior official in the Central Board of Revenue (CBR) told Dawn that around Rs25 billion arrears were stuck up in appeals in the superior courts due to the complicated and time consuming procedures of tax laws. The tax authorities are yet to come up with simple procedures to retrieve the amount from the defaulters.

According to a report prepared by CBR, the shrewd taxpayers thrive on tax avoidance by taking advantage of the lacunas in the tax laws and the procedures. The amount stuck up at various stages were involved in respect of several assessment years, which exceeded Rs25 billion, said the report.

The actual amount in arrears might be much more because of the fact that there were many cases, which were still pending with the concerned authorities. The report says that the system, besides being ineffective has many in-built disadvantages due to which the disposal of backlog takes about 2-3 years.

In the Income Tax Appellate Tribunal (ITAT), each year 25,000 appeals were filed, out of which only a few thousands were decided annually. Moreover, the time taken for decisions run into number of years, which adequately explained the enormity of the problem, wastage of valuable time of the stakeholders and also the money.

According to the report, most of the assessing officers were neither conversant with the laws nor were trained for performing the functions of quasi judicial or before the judicial forums.