The Federal Tax Ombudsman (FTO) has called for immediate measures to secure taxpayer data and apprehend those responsible for a significant cybersecurity breach that exposed critical weaknesses in the Federal Board of Revenue’s (FBR) data security. This breach resulted in fraudulent transactions amounting to Rs. 81.43 billion and a tax loss of Rs. 14.66 billion.
In response to the breach, the FTO has urged the FBR to implement robust cybersecurity measures to prevent future incidents. Meanwhile, complaints filed by taxpayers against the FBR have surged by 67 percent in 2024 compared to the previous year.
During a press conference on Wednesday, Almas Ali Jovindah, Advisor Legal & Media Wing, reported that the FTO Secretariat received 10,515 complaints over the past ten months, resolving 9,900 of them—a significant improvement from previous periods. Jovindah emphasized that action against corrupt tax officials is contingent upon complaints filed by affected businesses. He encouraged the business community to approach the FTO without fear of harassment.
Highlighting the FTO’s achievements, Jovindah noted the increased use of Section 33 of the FTO Ordinance for informal dispute resolutions, which has streamlined the process for taxpayers. A key outcome of the FTO’s intervention has been the expedited processing of delayed tax refunds, with Rs. 2.00 billion refunded to taxpayers in ten months, compared to Rs. 17.742 billion in 2023. Additionally, Dr. Jah has led a record 31 own-motion investigations to address systemic issues within the tax administration, reaffirming the FTO’s dedication to resolving taxpayer grievances.
The FTO’s performance has been bolstered by a seasoned advisory team conducting extensive outreach to educate the public on their tax rights, fostering greater awareness and trust. Technological advancements have further revolutionized the adjudication process, with paperless and remote hearing solutions, such as custom Zoom links, making proceedings more efficient and accessible for taxpayers worldwide, including those in the United States, Canada, Saudi Arabia, and China.
In a recent case, the FTO issued recommendations to the FBR regarding unjustified withholding tax deductions by the Punjab Council of Arts and Culture, ensuring tax practices align with the Income Tax Ordinance and protecting low-income individuals from unfair burdens.
The FTO has also taken a strong stance against FBR’s SRO 350(I)/2024, which inadvertently disrupted sales tax filings and business operations. The FTO has urged the FBR to simplify filing processes, provide guidelines, and update the IRIS system to support compliance without hindrance. The call for an automated system to recognize mutual transactions between buyers and sellers reflects the FTO’s commitment to convenience and fairness in tax administration.
