Pakistan’s Federal Board of Revenue (FBR) is facing renewed pressure to speed up the processing and payment of pending income tax and sales tax refunds following concerns raised by the Karachi Tax Bar Association (KTBA).
During a meeting with FBR Chairman Rashid Mehmood Langrial, the association highlighted delays affecting taxpayers who have paid excess taxes but lack clear information about when their refunds will be issued. In response, the chairman directed officials to develop a time-bound procedure to accelerate income tax refund processing.
Taxpayers Seek Faster Refund Payments
The KTBA stressed that taxpayers who fulfil their legal obligations should receive refunds without unnecessary delays. It called for a more predictable process that would help individuals and businesses understand when outstanding claims are likely to be settled.
The association also raised concerns about pending applications from taxpayers seeking to revise their income tax returns to claim refunds related to tax paid under Section 7E. It urged the FBR to fully implement instructions issued in a letter dated September 23, 2026.
Sales Tax Procedures and Business Concerns
The meeting also addressed difficulties businesses face when complying with sales tax requirements. The KTBA raised concerns about Sales Tax General Order No. 25/2026, which requires registered taxpayers to issue prescribed stock transfer notes when moving goods between business premises.
FBR officials acknowledged the concerns and agreed to examine the matter through internal consultations. The association also called for simpler procedures for foreign investors and said non-resident taxpayers should not face compliance requirements beyond those specified by law.
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IRIS Portal Problems and Other Tax Issues
The KTBA highlighted recurring technical problems with the FBR’s IRIS online tax system, including difficulties uploading bulk data and delays in issuing notifications related to tax returns.
The association also called for due process before tax authorities initiate coercive recovery proceedings for advance income tax. It emphasised that taxpayers should receive a reasonable opportunity and sufficient time to meet their obligations.
The FBR chairman acknowledged several concerns raised during the meeting and directed officials to work on improving refund processing. However, the time-bound procedure is still to be formulated, so a specific completion date for all pending claims has not been confirmed.
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