ISLAMABAD (January 30 2004): The Central Board of Revenue (CBR) would assess withholding tax on the imported goods on the basis of import value including custom duty and sales tax as per Income Tax Ordinance 2001, official sources told Business Recorder here on Thursday.
The provision of section 148 of the Income Tax Ordinance 2001 has been resorted by the Lahore High Court suspending the order of Income Tax Appellate Tribunal (ITAT), Lahore.
Official sources told Business Recorder here on Thursday that under section 148 of the Income Tax Ordinance 2001, taxes required to be deducted on the value of goods imported at specific rates. The value of good is to be taken the value as determined under section 25 of the Customs Act, 1969 as increased by custom duty and sales tax if payable thereon.
The income tax was being deducted in accordance with these provisions of law. However, Income Tax Appellate Tribunal (ITAT) decided a case against the CBR and held that the tax should be deducted only on the import value excluding custom duty and sales tax. This decision has not only created legal anomaly and distortion in law, but the taxpayers started filing applications demanding the benefit of the concession in other cases.
Sources further said that the ITAT decision was against the statutory provisions as contained in Income Tax Ordinance 2001. Therefore, the department filed a reference in the Lahore High Court against the order of ITAT.
Lahore High Court has suspended the operation of above-said decision of the ITAT, officials added.