The FBR Cannot Exercise New Tax Laws Due to the Absence of Government

The FBR Cannot Exercise New Tax Laws Due to the Absence of Government

The Federal Board of Revenue or FBR is unable to issue any notification or SRO to revise tax rates where the approval of the ECC or Cabinet is needed.

Under the current political situation, the authority of FBR to issue SROs has been limited. According to sources, there are four types of SROs.

Types of SROs

The first category of SROs is those where the FBR has the legal authority to issue notifications under the Income Tax Ordinance, Federal Excise Act, Sales Tax Act, and Customs Act.

The second category is where approval of the Minister of Finance is necessary. SROs can be issued after the approval only. The third category of SROs needs the approval of the ECC or the Economic Coordination Committee of the Cabinet. The fourth and last category of SROs needs a green light from the federal cabinet.

The FBR can issue SROs of procedural nature or technical alterations only, but cannot make any change in the tax rates. Due to the current political and governmental situation, the FBR can issue procedural SROs only.

Considering there is no Finance Minister, the FBR cannot move a file for approval as a Minister-in-charge is needed.

It is important to mention here that there are certain circumstances in which fiscal laws allow the organization to make alterations to the existing SROs.

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