Tax Ombudsman’s office fails to create any impression

The Tax Ombudsman’s office has failed to create any appreciable impression on the taxpayers as it received only one complaint every three days on average during its three years of existence.
Moreover, only half of the complaints were registered for investigation during the period by the office that started function in July 2006 to address tax-related injustice and harassment.
Most of the complaints it received were from small individual taxpayers, who could not afford to pay tax lawyers or wait for months to get things settled in courts or tax tribunals, Tax Ombudsman office data showed.
Big taxpayers still prefer other forms of adjudication such as the tribunals run by the National Board of Revenue and the High Court to the quasi-judicial settlement system of the Tax Ombudsman for tax-related grievances.
Corporate houses and big businesspeople find it easier to lodge their complaints with tax tribunals or law courts to benefit from the delay in settlements, Ombudsman’s office sources pointed out.
In six months of 2006, the Tax Ombudsman’s office received only 10 complaints, while 119 complaints were lodged in whole 2007. Aggrieved taxpayers brought 241 allegations in 2008, of which 137 were registered for settlement. The office settled 118 complaints, while the rest 29 are in the process.
In contrast, three tax appeal zones in Dhaka and two others in Khulna and Chittagong received 20,704 disputes and settled 18,208 of them only in the 2007-08 fiscal year.
Critics and taxpayers have already identified the office as ‘a toothless tiger’, ‘a watchdog in chains,’ ‘a swordless crusader,’ or an ‘ombudsflop’ as the number of tax-related cases is much higher in the legal courts and the NBR’s tribunals than the Tax Ombudsman’s office.
The country’s first Tax Ombudsman, Khairuzzaman Chowdhury, admitted the fact and said big taxpayers do not come to his office to seek justice.
Small taxpayers have so far submitted allegations against the taxmen about various forms of malpractice. This section of taxpayers cannot afford to go to the courts, he pointed out.
Khairuzzaman, who served the last three years of his bureaucratic career as NBR’s chairman, said big taxpayers prefer to go to the High Court as they consider it more dependable.
A company executive told New Age that an aggrieved taxpayer has to lodge a complaint with the Tax Ombudsman’s office within six months of being overtaxed or harassed, and specifically mention the name of the taxman.
This is very discouraging as there is a big chance of facing the hostility of that taxman in the future. Such a chance is, however, low in the case of other forms of adjudication, especially by the law courts, he pointed out.
Besides, settlement by the courts is preferable as a company has to submit many papers and documents to the Tax Ombudsman’s office, which may prove disastrous for it.
An insider, while describing a case, said the Tax Ombudsman’s office received an allegation of inflated income-tax assessment by a taxman which [allegation] turned out to be incorrect. But at the same time concealment of tax-related information also came to light, which was unfortunate for the businessman, he said.
Khairuzzaman pointed out that more than 95 per cent of the taxpayers were dependent on lawyers who often gave wrong suggestions to them and discouraged them from approaching his office.
Dr Rashidul Ahsan Chowdhury, an advisor to the tax ombudsman, identified improper maintenance of taxpayers’ records, slackness in responding to taxpayer’s applications and unlawful and extra-legal decision-making of the taxmen as major irritants giving rise to genuine grounds of discontent in the taxpayers.
He wrote in a column that creating awareness of the role and functions of the Tax Ombudsman’s office in the taxpayers was impossible without solving those problems.
Besides these factors, the insiders observed that the activities of the army-backed interim administration in the last two years had blocked the smooth progress of the Tax Ombudsman’s office.
They said they had to abandon a programme on creating awareness among the taxpayers before the scheduled date. They observed that the number of complaints would have been much higher if there were no ‘anti-corruption crackdown’, which created panic in the taxpayers.

Courtesy of NewAgebd