Inland Revenue Welfare Fund Rules, 2016.

Government of Pakistan
Revenue Division
Federal Board of Revenue

Islamabad, the 21st September, 2016.

NOTIFICATION

S.R.O. 895(I)/2016.- In exercise of the powers conferred by sub-section (1) of section 237 of the Income Tax Ordinance, 2001 (XLIX of 2001), section 50 of the Sales Tax Act, 1990 and section 40 of the Federal Excise, Act, 2015, the Federal Board of Revenue is pleased to direct that the following further amendments shall be made in the Income Tax Rules, 2002, the same having been previously published vide Notification No. S.R.O. 755(I)/2016 dated the 15th August, 2016, as required by sub-section (3) of the said section, namely:-

1. Short title, extent and commencement.- (1) These rules may be called the Inland Revenue Welfare Fund Rules, 2016.

(2) They shall apply to the Central Inland Revenue Welfare Fund maintained at the Federal Board of Revenue (FBR) Headquarters and the Regional Inland Revenue Welfare Funds maintained at all Inland Revenue formations.

(3) They shall come into force at once.

2. Definitions.- In these rules, unless there is anything repugnant in the subject or context,-

(a) "Inland Revenue Welfare Fund" means a Fund established under rule 8 of the Inland Revenue Reward Rules, 2016 and shall include the Central Inland Revenue Welfare Fund and the Regional Inland Revenue Welfare Funds; and

(b) "Fund" may be construed as the Central Inland Revenue Welfare Fund or the Regional Inland Revenue Welfare Funds, as the context requires, and the word "Board of Fund" may be construed as the Central Inland Revenue Welfare Fund Board or the Regional Inland Revenue Welfare Fund Boards, as the context requires.

3. Constitution of Central Inland Revenue Welfare Fund Board.- (1) There shall be constituted and managed a Central Inland Revenue Welfare Fund Board at FBR Headquarters, Islamabad which shall consist of the following officers, namely:-

(2) The Central Inland Revenue Welfare Fund Board shall act as governing body of the Regional Inland Revenue Welfare Funds of all field formations. It shall grant approvals of proposals and requests from the Regional Inland Revenue Welfare Fund Boards.

(3) The Central Inland Revenue Welfare Fund Board shall look after the Inland Revenue Welfare Fund activities at the FBR Headquarters.

4. Formation of Regional Inland Revenue Welfare Fund Boards.- There shall be formed and managed a Regional Inland Revenue Welfare Fund Board in each Large Taxpayer Unit (LTU) and Regional Taxpayer Office (RTO) and Directorate General which shall consist of the following, namely:-

5. Functions of the Central Inland Revenue Welfare Fund Board.- (1) The Central Inland Revenue Welfare Fund Board shall perform the following functions, namely:-

(a) management of income and expenditure of the Central Inland Revenue Welfare Fund;

(b) formulation of policies and taking all measures to implement such policies for the investments, generation of further funds and all matters relating thereto;

(c) supervision over the Regional Inland Revenue Welfare Fund Boards;

(d) appointment of auditors for the Fund; and

(e) holding of an annual general meeting not more than six months after the end of the financial year for the purpose of scrutiny of the auditor's report and the review of the working of the Board of Fund during the financial year:

Provided that the Board of Fund may hold an annual general meeting within three months of the period stipulated above, for sufficient reasons to be given in writing.

(2) The Central Inland Revenue Welfare Fund Board shall not spend more than sixty percent of the receipts or anticipated receipts for the financial year during the year:

Provided that if the Board of Fund is of a unanimous view that sufficient reasons exist to incur an expenditure in excess of the above limits, it may, for the reasons to be shown in writing, authorize an expenditure in excess of these limits:

Provided further that the expenditure shall not in any case exceed eighty percent of the receipts or anticipated receipts for the financial year.

(3) Any amount that is not expended by the pool during the year shall be invested in Government securities and the profit received there from every year shall form part of the

receipts of the Fund for that year:

Provided that no investment shall be made in any speculative or risky transactions.

6. Functions of the Regional Inland Revenue Welfare Fund Boards.- (1) The Regional Inland Revenue Welfare Fund Boards shall perform the following functions, namely:-

(a) management of the income and expenditure of the respective Regional Inland Revenue Welfare Fund;

(b) formulation of policies and taking all measures to implement such policies for the investments, generation of further funds and all matters relating thereto;

(c) holding of an annual general meeting not more than six months after the end of the financial year for the purpose of scrutiny of the auditor's report and the review of the working of the Board during the financial year:

Provided that the Board of Fund may hold an annual general meeting within three months of the period stipulated above, for sufficient reasons to be given in writing.

(2) Each Regional Inland Revenue Welfare Fund Board shall transfer twenty percent of its receipts for the financial year to the Central Inland Revenue Welfare Fund within six months of the close of the financial year, for utilization by the Board of Fund at FBR Headquarters.

(3) Subject to sub-rule (2), the provisions of sub-rules (2) and (3) of rule 5 shall mutatis mutandis apply to the Regional Inland Revenue Welfare Fund Boards.

7. Income of the Central Inland Revenue Welfare Fund Board.- (1) Any amount that has remained unutilized with the Income Tax Central Board, or the Central Sales Tax Common Pool Fund Board, or Central Federal Excise Common Pool Fund Board on commencement of these rules shall immediately stand transferred to the Central Inland Revenue Welfare Fund Board.

(2) Any amount contributed, granted or allocated by the Federal Government, Federal Board of Revenue or FBR Foundation shall be transferred to the Central Inland Revenue Welfare Fund Board.

(3) It shall be obligatory for every officer and staff member posted at the FBR Headquarters, Islamabad to contribute an amount specified under sub-rule (3) of rule 9 of the Inland Revenue Reward Rules, 2016 towards this Fund out of the amount received under those rules.

(4) Each Regional Inland Revenue Welfare Fund Board shall transfer an amount stipulated under sub-rule (2) of rule 6 to this Fund.

(5) Nothing contained under these rules shall bar the Central Inland Revenue Welfare Fund Board from raising money through any lawful activity, such as holding a Mela or a Bazaar, or by raising hoarding or billboard on Inland Revenue Service property:

Provided that nothing contained in this rule shall authorise the Board of Fund to seek contribution from any taxpayer on an expectation of gaining any undue favour in connection with the assessment and collection of any tax.

(6) It shall be open to the officers and staff members of the Inland Revenue Service to make any voluntary contributions to the Fund.

8. Income of the Regional Inland Revenue Welfare Fund Boards.- (1) The Central Inland Revenue Welfare Fund Board may distribute the amount received from the Income Tax Central Common Pool Fund Board, or the Central Sales Tax Common Pool Fund Board, or Central Federal Excise Common Pool Fund Board under sub-rule (1) of rule 7 or amount received from the Federal Government, Federal Board of Revenue or FBR Foundation under sub-rule (2) of rule 7 to the Regional Inland Revenue Welfare Fund Boards, for investment or utilization by these Boards of Fund:

Provided that the amount shall be distributed among the Regional Inland Revenue Welfare Fund Boards in proportion to the strength of their staff:

Provided further that the maximum expenditure out of this amount by a Regional Inland Revenue Welfare Fund Board during a financial year shall not exceed twenty percent of the amount transferred.

(2) The provisions of sub-rules (3), (5) and (6) of rule 7 shall mutatis mutandis apply to the Regional Inland Revenue Welfare Fund Boards and the references to the officers and staff of FBR Headquarters shall be construed as references to the officers and staff of the respective LTU, RTO or the Directorate General.

9. Expenditure from the Inland Revenue Welfare Fund Boards.- (1) Subject to the provisions of these rules, the amounts lying with the Central Inland Revenue Welfare Fund Board and the Regional Inland Revenue Welfare Fund Boards shall be utilized for the following purposes, namely:-

(a) reimbursement of medical charges;

(b) reimbursement of health insurance premium for the staff upto BS-16, subject to the limits prescribed by the Central Inland Revenue Welfare Fund Board from time to time;

(c) stipend for education;

(d) marriage expenses;

(e) burial expenses;

(f) maintenance of transit accommodation and officers mess; and

(g) construction or maintenance of the premises of the local chapters of Pakistan Taxation Club.

(2) Notwithstanding anything contained in sub-rule (1), the expenditure under this rule shall be subject to the following maximum limits, namely:-

(a) in respect of medical charges, for the officers/officials and their dependents, reimbursement not exceeding 50% of the cost of consultation, treatment and medicines or Rs.5000 per month, whichever is lower;

(b) in respect of stipend for education, annual stipend of Rs.20,000 for one child of staff members upto BS-16 who secures 70% marks in Matric and is admitted to a college. The stipend may continue till graduation subject to scoring of 70% marks in each subsequent year;

(c) in respect of subsidy on marriage expenditure, an amount of Rs.50,000 for not more than two daughters of staff members upto BS-16;

(d) in respect of burial expenses, an amount of Rs.50,000 for in-service death of staff members upto BS-16; and

(e) in respect of transit accommodation and officers' mess, hiring of building, its furnishing including purchase of essential items, equipments, payment of utility bills and salaries of staff working in the mess. The officers availing the facility of mess will pay monthly service charges as prescribed by the Fund from time to time.

10. Expenditure with prior approval of Central Inland Revenue Welfare Fund Board.- The Central Inland Revenue Welfare Fund may authorize and sanction expenditure for the following purposes after getting prior approval from the Central Inland Revenue Welfare Fund Board, namely:-

(a) personal loan;

(b) renovations and repairs of Government residences;

(c) purchase and repair of vehicles for pick and drop of staff;

(d) hiring of officials for the Fund related work;

(e) expenses to hold a function and activity for common good of staff;

(f) subsidy and financial assistance to staff upto BS-16 retired from service; or

(g) any other project or activity involving common welfare of the staff,

Provided that the expenditure shall be sanctioned for the purposes enumerated in clauses (a) and (b) only under exceptional circumstances.

11. Regulation of the Funds.- (1) Notwithstanding anything contained in these rules, the Central Inland Revenue Welfare Fund Board shall monitor and regulate expenditure of Regional Inland Revenue Welfare Funds and may place restrictions and curtail disbursement of funds under various heads.

(2) The audit of the Central and Regional Funds shall be carried out annually by a firm of chartered accountants or a firm of cost and management accountants appointed by the Central Inland Revenue Welfare Fund Board.

(3) Subject to these rules, the decisions shall be taken by the Central Inland Revenue Welfare Fund Board or by the Regional Inland Revenue Welfare Fund Boards by majority of the votes, provided that the dissenting votes shall be recorded.

[F.No. 4(44)IT-Budget/2016]

(Syed Hassan Sardar)
Secretary (Rules & SROs)