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The Federal Tax Ombudsman (FTO) issued a significant order regarding the jurisdiction of taxpayers

ISLAMABAD: The Federal Tax Ombudsman (FTO) issued a significant order regarding the jurisdiction of taxpayers on Wednesday. The order instructs the Federal Board of Revenue (FBR) to provide convenience to taxpayers by implementing taxation processes at their business locations.

The Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to reassess a decision that changed a taxpayer’s jurisdiction, moving it 450 km from the business location in Sukkur to Karachi. This move had caused considerable inconvenience to many business owners whose tax jurisdictions were similarly shifted away from their actual business sites.

The FTO’s recent decision, issued on Wednesday, stated that the specific jurisdiction change in this case, involving a complainant who is a rice dealer and also earns income as a member of a Builders & Developers Association of Persons (AOP), was not appropriate. The FTO ruled that this transfer from the Regional Tax Office (RTO) Sukkur to the Medium Tax Office (MTO) Karachi, without proper consideration of the nature of the complainant’s income from various sources, constituted maladministration.

Furthermore, the FTO has instructed the FBR to direct its Secretary Jurisdiction to reevaluate the jurisdiction change for the complainant, suggesting a return from MTO Karachi to RTO Sukkur.

In response, the FBR argued that their recent jurisdiction policy dated November 30, 2023, mandated that all Builders & Developers cases from RTO Hyderabad/Sukkur/Quetta be moved to the Special Zone for Builders & Developers at MTO Karachi. The FBR maintains that this policy and the transfer of the complainant’s case to MTO Karachi align with the powers granted by the Income Tax Ordinance 2001.