NBR limits access of audit directorate to income tax files

National Board of Revenue has asked its field offices not to give the Local and Revenue Audit Directorate under the Office of the Comptroller and Auditor General (CAG) access to detailed documents of income taxpayers for audit purpose.

LRAD will only be given access to three types of documents — tax calculation paper, demand notice and related register — prepared by the tax officials based on the documents like income tax returns, submitted by a taxpayer, according to the instruction of the NBR.

Income tax wing of the NBR on August 22 issued the instruction to its 31 income tax commissionnerates across the country saying that the LRAD would be able to audit only the abovementioned three documents.

The wing issued the instruction as per decision of the board meeting, presided over by NBR chairman Md Mosharraf Hossain Bhuiyan, held on July 16.

Officials said that NBR took the decision of limiting the access of auditors after the LRAD on January 19 sent an audit engagement letter to the NBR for conducting audit of direct and indirect tax collections for the fiscal year 2017-2018.

NBR officials said that a number of documents such as tax returns, accounts and affidavit of taxpayers and record of any proceedings related to the assessment of tax and recovery of demand were confidential as per the Income Tax Ordinance-1984 and could not be disclosed.

Individual and corporate taxpayers submit the details of income, expenditures, assets, import-export and other financial transactions to the income tax and VAT departments as per tax and VAT laws.

Earlier, VAT wing also issued similar instruction to its field offices.

As per law, the LRAD is empowered to audit the government documents, receipts and public spending, not the documents of private entities submitted to the tax offices, they said.

A number of writ petitions were filed by taxpayers on different occasions challenging the area of power of the auditors, they added.

CAG officials, however, said that they had all the powers to audit taxpayers’ documents that belong to the tax offices as per constitution, which empowered the CAG office to audit all of the government documents of the taxpayers.

Source: New Age.

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