The Federal Board of Revenue is working on the launch of a new modified automated system for filing of ST&FE returns that will eliminate a lot of the shortcomings of the previous system and make the whole process a lot easier for taxpayers.
The current system, although automated, is plagued with issues like post-return input discrepancies, which presently cause a great hassle for the department and taxpayers.
Mismatching anomalies due to data feeding errors makes the process even more cubersome and as a result, the FBR is proposing a new system that will not only eliminate the post-return input discrepancies but also lead to the returns being considered a complete refund claim and thus also expedite refund payment process.
The newer system requires early submission of sales invoice data (Annex-C) enabling the buyers to claim input against the same. According to FBR, it is a system for self-processing for tax declarations and shall ensure declaration of all transactions, filing of returns, payment of due tax at the time of filing of returns.
How is it better than the previous system?
- Authority to process return in the hands of RP(buyer) itself.
- Minimized role of Department for compliance.
- Transparency in processing of return.
- Facility of re-use of data as the RPs will not be required to prepare data for Annex-A of the return.
- Annex-A, STARR, ERS data integration.
- RP can instantly see the relevant profile of his supplier
The system can be rolled out for load testing from July 2016. Once approved, it shall become functional from July.
You can find the full detailed report on the new system over here.
Apart from this new updated tax system, the FBR also announced yesterday to increase tax collection from those who are already inside the tax net by charging higher rates from those salaried individuals who are outside the tax net, or simply did not file their income tax returns.
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