Islamabad: The Federal Board of Revenue (FBR) has revealed that the recently installed ‘Fully Automated Sales Tax e-Refund (FASTER) system will provide sales tax refunds to exporters within 72 hours of their submission refund claims, a news source reported.
FBR Sales Tax Chief Hamid Memon said that the taxation authority would issue refunds within the next couple of days. He added that the board would provider refunds amounting to PKR 15-20 billion to the five export-oriented sectors on a monthly basis.
Memon also clarified that the FASTER system would only process the current claims for sales tax refunds from the exporters. He explained that the system would issue the refunds electronically through communication of refund payment orders (RPO) to the State Bank of Pakistan (SBP). From there, the SBP will forward the advice to the commercial banks wherein the exporters hold their bank accounts.
Additionally, Memon said that the new system would feature the following rules:
The exporters will have to follow Annexure-H (stock statement). They will have the relaxation of filing it even after the submission of the sales tax returns. The system will process the refund claim as soon as the exporter files the stock statement
FASTER will discourage the practice of flying invoices to a large extent
The new automated system will control issue of fake invoices
Total amount of refunds paid against the claims filed and processed will not exceed the upper limit as determined by FBR (in percentage of value or amount per unit of quantity of goods exported as seen appropriate)
A risk management system (RMS) will process the submitted claim before routing it to FASTER
FBR will treat the data provided in the monthly return as in support of the refund claim. The exporters will not have to present any separate electronic data
FBR will consider the amount mentioned in ‘Column 29’ of the form STR-7 as the amount claimed after the return has been submitted in addition to other required annexes
FBR will carry out a post-refund payment audit to identify and resolve anomalies
In the FASTER system, the sales tax chief added, the board had introduced some benchmarks to ensure that submitted refund claims were genuine. He stated that the system would correlate the taxable purchases with the refund claims.
Memon said that government was providing this facilitation to assure the exporters that the FBR had removed human involvement in the processing of their sales tax refunds.
