ISLAMABAD: The government has made it mandatory for the Federal Board of Revenue (FBR) to resolve tax disputes within 45 days.

Significant changes have been introduced to simplify the alternative dispute resolution process and make it more cheaper and efficient for taxpayers registered under the Sales Tax Act and Federal Excise Act, according to circular no 02 2023-24 issued on Monday.

As per the amendments, the FBR will now appoint a committee within 15 days of receiving the application for dispute resolution, compared to the previous 45 days. The committee must now decide the dispute within 45 days, extendable by 15 days with written reasons. Earlier, the decision had to be made within 120 days.

Now, registered individuals can propose their terms for resolving the dispute, including an offer for tax payment. This is a departure from the fixed and irrevocable nature of offers made previously. The third member of the dispute resolution committee, who used to be nominated through consensus, is now a retired judge not below the rank of a high court judge. The Law and Justice Division will nominate the chairperson from a panel.

Previously, both the registered person and the commissioner were required to withdraw pending appeals before appellate fora to resolve the dispute. Now, this requirement is no longer binding on both parties. These amendments aim to streamline the dispute resolution process, making it more efficient and fair for all parties involved.

Once the committee is formed, the recovery of tax payable by the registered person related to the dispute will be deemed stayed until the committee makes a decision or is dissolved.

Published in Dawn, July 25th, 2023