KARACHI, June 11: Tax experts and consultants believe that the proposed amendments in the Income Tax Ordinance 2001, through the Finance Bill 2003, are going to mutilate the concept of Universal Self Assessment (USAS) and will also greatly enhance the discretionary powers of tax officials.

The tax experts fear that once the proposed amendments are incorporated very few returns will qualify for assessment under section 120.

Above all, if the Bill is allowed in its present shape to become part of the Income Tax Ordinance 2001, it will greatly enhance the discretionary powers of assessing officers and will always be remembered as a “black law”, the tax consultants told Dawn.

They suggested to the Finance Minister Shaukat Aziz to personally look into the matter and save the Income Tax Ordinance 2001 from being mutilated, and withdraw negative amendments to ensure that the Ordinance was not damaged to such an extent that it became unacceptable to taxpayers.

A tax consultant Mr Younus Rizwani Sheikh said that the proposed amendment in section 114 was being made to ensure that a return of income was in prescribed form and was accompanied by all particulars as specified in the form of return including the declaration of the books of accounts kept by a taxpayer.

The amendments deemed to have been made, he said, in this section vide SRO633(1)/2002 dated 14.09.2002 issued under section 240 of the Income Tax Ordinance 2001, have been incorporated vide this Finance Bill.

This amendment when examined in the light of the proposed amendment in section 120, Rizwani said it led to a conclusion that only complete returns of income prepared in accordance with the provisions of the amended section shall qualify for assessment under the provisions of amended section 120.

The proposed amendment in section 120, he said, had violated the basic concept on which the Income Tax Ordinance 2001 was based i.e. “voluntary compliance backed by strong audit.” Before the proposed amendment any return filed by a taxpayer under section 114 qualified to be an assessment order deemed to have been issued by the income tax commissioner on the day the return was filed.

He further said that the new democratic government instead of sticking to the commitment of the previous government to curtail the discretionary powers of the tax officers is enhancing them and tax consultants are sure that these discretionary powers will be abused as was the practice in the past and very few returns will qualify for assessment under section 120.

Responding to a question, he said, no doubt, there were few positive amendments in the Finance Bill but as a tax consultant it was his duty to draw the attention of the authorities concerned towards such irritants which might cause revenue loss or become a tool of harassment in the hands of tax collectors.

Another tax consultant and advocate Supreme Court, Mr Muhammad Ather Saeed, drew the attention towards section 122 and said that the provision of this section has been drastically changed and all the ingredients of section 65 and 66A of the Repealed Ordinance had been included in this section.

It was being pointed out by tax experts that section 12 was a poorly drafted section and had been hoping that necessary amendments would be made in this section to make it practical and workable. However, the proposed amendments in this section had added fuel to the fire and enhanced the chaos and confusion already existed.

While strongly rejecting the proposed amendments in section 122, said: “We feel that these amendments are tantamount to mockery of the Income Tax Ordinance, 2001 and strongly advocate for their withdrawal.”

Income tax practitioner, Mr Qazi Anwar Kamal said that it was ironic that powers to enter any premises by tax officials under section 175 had not been abolished to the violation of sanctity of Chadar and Char-diwaari.

He said the proposed amendment in this section through the Finance Bill 2003, was tantamount to sprinkling salt on the wounds.

Mr Kamal reiterated that section 175 should be suitably amended to restrict the entry of tax officials to the business premises only. He said without defining the premises the powers to enter and search premises should also mean of private homes.