The president, Abdul Hamid, on Wednesday promulgated two separate ordinances empowering the National Board of Revenue to extend time for submission of value-added tax returns and income tax returns with waiving penalty and interest on applicable taxes.
According to the VAT and Supplementary Duty (amendment) Ordinance-2020, the revenue board, with prior approval of the government, will be able to extend the deadline for submission of VAT returns with exemption from payment of penalty and interest in situation like natural disaster, pandemic, any act of God and war.
The revenue board will also be able to extend such deadline and give exemption with retrospective effect, said the ordinance, which came into effect on April 1.
The Income Tax (Amendment) Ordinance-2020 also empowered the revenue board to condone the period epidemic, pandemic or any other acts of God and war in computing the time limits specified in any provision of the Income Tax Ordinance-1984.
The NBR will also be able to extend such time limits with prior approval of the government, said the ordinance which was given retrospective effect from March 25.
NBR officials said that there were no provisions of extending the deadline for returns submission and waiving penalty and interest in both VAT and income tax laws.
Many businesses could not file VAT returns in April and May due to the shutdown imposed by the government to tackle the coronavirus pandemic and the failure put the businesses at risk of additional financial burden of penalty and interest.
The revenue board could also not extend the deadline and it had no authority to waive the penalty and interest as there were no such provisions in the VAT law.
On the other hand, many income taxpayers could not file income tax returns, including withholding tax returns, and deposit tax deducted at source within the deadline due to the shutdown.
In the income tax law, there are also time restrictions in many areas such as for making appeal, depositing tax and filing income and tax statements, the officials said.
Now, the NBR will be able to take measures to give respite to traders and taxpayers in these issues, they added.
A senior VAT official said that they would soon extend the return submission time with offering waiver of fine and interest.
The VAT wing will issue an order after completing required formalities, he said.
An income tax official also said that they were working to issue an order relaxing the time restriction for return submission
There may be some conditions that traders and taxpayers will have to fulfill to get the benefit, he said.
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