NBR\\\'s authority challenged

A good number of tax-related decisions have remained stalled as the law ministry recently asked the revenue board to seek legal clearance in the matters of some SROs through the Internal Resources Division (IRD).
Some important Statutory Regulatory Orders (SROs) of the income tax, customs and VAT wings were sent by the National Board of Revenue (NBR) for vetting by the law ministry. But all were sent back.
Sources said the law ministry declined to do the vetting as the NBR recently had sent the SROs directly to the ministry, as per usual practice.
But the law ministry took exception as, under the existing law, only 'government' or 'ministry' can seek law ministry's vetting for an SRO.
According to government 'rules of business' a ministry can seek legal clearance on an issue, not a department, said a former finance ministry official.
He said the NBR is not a ministry and so it should come through administrative channels to seek legal clearance on SRO.
The NBR has maintained such process of issuance of SRO since its inception.
The board prepares a draft of SRO after getting approval from the Finance Ministry that it send to the law ministry to verify whether the new draft law contradicts other laws.  
There are hundreds of SROs issued by the income tax, customs and VAT (value-added tax) wing of the board. Only, the income-tax wing had issued more than 300 SROs following that process since 1984.
A senior NBR official said the law ministry raised such a question in 1980 first but it was resolved on grounds that tax-related decisions are usually confidential and sometimes need speedy disposal.
There is scope to cash in billions of taka through disclosure of information of an SRO before its issuance, he noted to justify the direct action followed just until now.
"To follow the procedure, the NBR will have to send the draft SRO to IRD, which may make the decision-making process lengthy and pose risk to the confidentiality of the tax-related matters," he said.
The official, however, raised question over justification of sending the SRO via IRD, claiming that there is no expertise on tax-related matters in the IRD to add value or examine the orders.
"The procedure would rather delay government's decision-making process," he said.
Officials also questioned why law ministry has provided vetting to hundreds of SROs so far that include budgetary ones too.
After many decades the question of NBR authority to seek legal clearance has been raised. And it surprises many of the tax officials.
There are many decisions regarding petroleum products, mobile-phone surcharge, tax-exemption plea of SAHIC, and mother and child hospital stuck-up due to the latest tangles.
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