FBR to seek data from professional bodies to expand taxnet

[Naveed Yaseen]

Bringing doctors, lawyers and Chartered Accountants into tax net: FBR to seek data from professional bodies
SOHAIL SARFRAZ
ISLAMABAD (August 15 2009): The Federal Board of Revenue (FBR) has decided to approach Supreme Court of Pakistan, bar associations, Pakistan Medical Association, the Institute of Chartered Accountants of Pakistan (ICAP), etc, to bring lawyers, doctors/medical practitioners, chartered accountants and tax practitioners into the tax net.

Sources told Business Recorder on Friday that the lawyer s, legal practitioners, doctors, medical practitioners, chartered/cost accountants and tax practitioners having taxable income are liable to file income tax returns and pay the due amount of tax under relevant provisions of the Income Tax Ordinance 2001.

Under the enforcement plan to bring professionals into the tax net, the FBR has given top priority to doctors, lawyers, chartered accountants and tax practitioners, who are earning huge incomes, but are still out of the tax net.

To bring doctors into the income tax net, the FBR would obtain information about potential doctors and medical specialists from Pakistan Medical Association, autonomous government hospitals and medical colleges, private sector hospitals and provincial health departments. This data would be utilised by the income tax department to bring each and every potential (taxable) doctor into the tax net.

In case of lawyers and legal practitioners, the FBR has decided to contact the registrars of the Supreme Court of Pakistan and High Courts, bar associations and companies paying retainsership to obtain necessary data about lawyers engaged in practice at courts. The FBR would collect information about chartered/cost accountants and tax practitioners from ICAP, tax bar associations and provincial boards of revenue, etc.

Within the 'professionals' category, it is an uphill task to register doctors, lawyers and chartered accountants with the income tax department for payment of due tax and filing of returns. These professionals are earning taxable income, but are reluctant to come into the tax net.

In the past also all efforts of the tax department failed to improve compliance of lawyers, doctors/medical practitioners, chartered accountants and tax practitioners due to severe resistance from these professionals. It would be a challenging task for the income tax officials to bring influential doctors and lawyers having political backing into the tax net. Whether the FBR would depute tax officials at the clinics of leading doctors to monitor their daily turnover for payment of tax is not known yet, sources added.

However, the Enforcement Divisions of Large Taxpayer Units and Regional Tax Offices (RTOs) have received instructions from FBR to invoke relevant provisions of the Income Tax Ordinance 2001 to bring these professionals into the tax net. In this regard, the regional offices would follow the due process of law after collection of necessary data specified to register these professionals.

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