ISLAMABAD: President Asif Ali Zardari has upheld the Federal Tax Ombudsman (FTO) decision granting tax relief to thousands of art students and performers in Punjab. In this regard, the president has rejected 141 representations of the Federal Board of Revenue (FBR). This decision addresses longstanding complaints about excessive tax deductions from payments made to artists participating in arts and cultural events. The president, in his order, emphasized the legal correctness of the FTO’s decision, stating, “The withholding tax is to be deducted under Section 153(1)(b) and not under Section 156 of the ordinance of 2001. In this view of the matter, the order of the Federal Tax Ombudsman is upheld. The representation is dismissed.” The controversy began when hundreds of complaints were filed with the Federal Tax Ombudsman. These complaints, primarily from students of arts and music across various academies, addressed the withholding tax deductions from the compensation they received for participating in events organized by the Punjab Council of Arts and Culture, Lahore. The deductions, at rates of 20% for filers and 40% for non-filers, imposed a significant financial burden on the students, many of whom are from low-income backgrounds. The Regional Tax Officer (RTO) had argued that these payments constituted prize money and were subject to taxation under Section 156 of the Income Tax Ordinance, 2001. However, the Punjab Council of Arts and Culture clarified that the payments were…