Pay tax first, then move court over any dispute

A government move is underway to bring changes in the income-tax provision to make any aggrieved taxpayer pay the assessed income tax first before moving court over any dispute, officials said.          
The revenue authority has taken the initiative against the backdrop of a huge amount of taxes having long been trapped under a logjam of cases.
With the revision of the legal provision, aggrieved taxpayers may have to pay the fully assessed tax or value added tax (VAT) before filing case against taxmen, they said.  
The board's move came in line with the direction of a fiscal coordination council on revision of the income-tax law in a bid to discourage filing court cases.
On November 11 last, a meeting of the government's coordination council on fiscal, currency and currency exchange rate, headed by Finance Minister AMA Muhith, directed the National Board of Revenue (NBR) to take initiative to amend the income-tax law.
As per direction, an aggrieved taxpayer will have to pay the total tax amount, assessed by the taxmen, before filing cases or appeal against the assessment.
However, taxmen expressed their doubt about feasibility of the changes as the existing tax law has the provision of payment of an amount of the assessed tax before filing appeal or case.
The income-tax wing of the NBR recently sent a letter to the macroeconomic wing of the ministry of finance with its opinion on the direction from the council.
"There is a specific rule for lodging case by any individual and company against taxmen. Aggrieved taxpayers can lodge first appeal under section 153 of the Income Tax Ordinance with the payment of tax at a prescribed rate," the NBR said in the letter.
Under Section 158, the taxpayer can file second appeal with the appellate tribunal while lodge reference case with the High Court (HC) under section 160.
"Any change in the provision needs amendments to the Income Tax Ordinance 1984 through Finance Bill," said the NBR.
The NBR will review the existing rules on tax collection from the aggrieved taxpayers at the time of lodging appeal or case to find out whether its is necessary to amend the law, it added.
"The board will take initiative to amend the law, if necessary," it said.
Under the existing provisions in the income-tax law, an aggrieved taxpayer needs to pay 10 per cent of the assessed tax for making appeal to the Appeal Commissioner.
The taxpayer will have to pay another 10 per cent tax for filing appeal before the Appellate Tribunal against the decision of the Appeal Commissioner.
A taxpayer needs to pay 25 per cent of the difference of tax, determined on the basis of Appellate Tribunal and actual payable tax in the income tax returns, for filing a reference case with the HC.
Officials said some taxpayers lodge case against decision of taxmen to keep payment of a large amount of revenue pending for years. Currently, some Tk 309.46 billion in tax revenue remained stuck in 24,572 court cases filed by the taxpayers.
In many cases, taxpayers won the battle with the taxmen. And taxmen will have to refund the tax if the rules on depositing full amount of assessed tax before lodging case come into force.
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