Attachment of bank accounts


THE decision-makers seem to have learnt no lessons from irrational measures taken in the past that failed to realize the intended benefits but ended up in erosion of trust and confidence between the citizens and the governmental machinery.

This is evident, apart from others, from the decision of the Federal Board of Revenue (FBR) to allow its officers to forcefully recover disputed taxes from bank accounts of taxpayers, withdrawing over two-year old instructions that had been issued to bar taxmen from taking money without prior intimation to the account holders.

The business community has justifiably expressed strong resentment against the move as it will widen the gulf of mistrust between the taxman and the tax-payers and might also lead to continuation of the corrupt practices in tax collection that the authorities are vowing to eliminate.

Representatives of different bodies of traders and industrialists have expressed the apprehension that the decision would also run contrary to the oft-repeated commitment of the Prime Minister to ensure ease of doing business and bring transparency in tax culture.

Apart from the elements of corruption and harassment, the initiative is feared to have negative effects on savings as it will discourage citizens to put their money in banks and rely more on cash transactions.

This would, in turn, badly affect the efforts of the Government to promote the idea of documentation of the economy.

There is no logic to give FBR access to bank accounts, freeze them and deduct ‘disputed’ taxes from them as this would harm commercial activities and interests of banks besides harming the universally accepted principles of privacy and secrecy of bank accounts, which are considered to be a trust between the bank and the account holder.

Regrettably, instead of tightening the noose around the neck of non-filers and tax-evaders, the successive governments have relied heavily on tax collection through utility bills, POL products and banking transactions and in the process even those segments of the society are made to pay taxes that are otherwise not liable to any tax.

These practices, which continue to date, need to be curbed and we hope the FBR would revoke its latest decision and instead use the already available tools of audit or personal hearing in case of any discrepancy in tax payment.


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