Taxes in Default Unit
The above unit of the Inland Revenue Department (IRD) has embarked on a money-making venture for the Government in the guise of calling for taxes already paid as “Taxes in default” (in most cases).
You can simply get some old records as old as 10 to 15 years and blindly call them to pay the taxes. We have seen notices/letters re ‘Taxes in default’ on GST/NSL /VAT for years ending prior to year 2000.
1. How on earth could the IRD expect a small timer to retain files and records as old as 14 to 15 years?
2. Some companies/proprietors/directors or partners may not even exist today. You may have to send these notices to their graves!
3. If you are so certain that you have not/failed to collect the taxes due to you then we got to ask you why IRD was so complacent in collecting these dues for more than 10 to 15 years (the concept of reasonable period is a big question mark here)
4. In our opinion you are simply harassing the taxpayers and creating panic among them. If taxes are not paid for more than 10 to 15 years you simply need to take them to courts and the whole country has the right to know who are these people and why they have not paid their taxes. The country will also come to know how inefficient the IRD is and how they maintain records when taxpayers produce their payment details to the courts.
For example a small businessman wound up his business about five years back simply because of harassment of this nature is doing a job now. This person has received a notice to pay taxes amounting to about Rs. 80,000 He has settled all these taxes, also has the relevant pay in slips and copies of letters sent to the IRD. along with these copies about 10 years back. He says people will get heart attacks when they receive notices of this nature.
5. If you claim is right – you get the payment with the penalty . If you are wrong you must pay damages to the taxpayer for making false claims. If the system works in this manner, everyone will be happy. But unfortunately it is not so in this country. Taxpayers have to spend most of their time at IRD- the time that they could spend to improve their businesses.