OICCI urges FBR to release PKR 103 billion in pending tax refunds

The Overseas Investors Chamber of Commerce and Industry (OICCI) has urged Pakistan’s tax authorities to immediately release PKR 103 billion in pending income and sales tax refunds, warning that mounting delays are creating serious liquidity pressures for foreign investors.

In a letter dated Feb. 24, addressed to Rashid Mahmood Langrial, chairman of the Federal Board of Revenue (FBR), OICCI Secretary General M. Abdul Aleem said outstanding refund claims of member companies had risen to PKR 103 billion as of February, compared with PKR 96 billion reported in November last year — an increase of nearly 7% in three months.

According to the letter, the total includes PKR 65 billion in pending income tax refunds and PKR 37 billion in sales tax refunds.

A significant portion of the backlog — PKR 74 billion — relates to Karachi-based member companies, followed by PKR 16 billion for Lahore and PKR 13 billion for Islamabad-based firms, the chamber said.

“The continued accumulation of refunds is creating significant liquidity constraints and operational challenges for our members, many of whom are major foreign investors in Pakistan,” Aleem wrote.

The chamber also referred to its earlier communication dated Jan. 30, in which it suggested that super tax demands be adjusted against pending refund claims where applicable. OICCI requested that the FBR implement this guidance to provide immediate relief to taxpayers.

In the letter, Aleem sought the personal intervention of the FBR chairman for the “expeditious settlement” of outstanding refunds and called for a transparent, time-bound mechanism to prevent further accumulation.

OICCI said resolving the issue would play a critical role in restoring investor confidence and supporting Pakistan’s foreign direct investment objectives.

The business chamber has repeatedly raised concerns over delayed tax refunds, saying the growing backlog is affecting business operations and cash flows of multinational companies operating in the country.