The Karachi Tax Bar Association (KTBA) has formally requested the Federal Board of Revenue (FBR) to extend the deadline for e-filing sales tax returns due to complications from SRO 350(I)/2024.
In a letter to the member IR operations, the KTBA emphasized the urgency of this request, following an August 20, 2024, meeting with FBR officials. They highlighted the need for immediate system adjustments and a deadline extension.
The new regulation, introduced on March 7, 2024, has disrupted the e-filing process, as taxpayers cannot submit returns unless their suppliers have fully settled their tax liabilities.
This dependency has caused a backlog of unfiled returns and the potential loss of input tax carry-forward.
Taxpayers have encountered error messages, particularly affecting those with export-related refundable claims, leaving many returns in “draft” status.
This has led to serious consequences, including the change of taxpayer status to “non-active” on the IRIS portal, triggering additional sales tax charges under Section 3(1A) of the Sales Tax Act, 1990.
The KTBA has requested an extension of the e-filing deadline under Section 26AB of the Act and urged the FBR to implement measures to maintain taxpayers’ “Active” status despite filing difficulties.