Dear taxpayer Please note that FBR issued series of new SROs (from SRO 895 to SRO 898) dated October 04, 2013, to introduce further amendments in Sales Tax Law. Brief of each SRO is described below: SRO 895(I)/2013 & SRO 896(I)/2013 Through the above SRO, amendments made in the Third Schedule of the Sales Tax Act, 1990 and the Sales Tax Special Procedure Rules, 2007 resultantly below items excluded from the third schedule meaning thereby that sales tax will not be charged on retail price. However 2% extra sales tax will be charged on these in addition to tax payable under section 1 and 2 of section 3 of the Act, as the case may be. S.No Description 23. Household electrical goods, including air conditioners, refrigerators, deep freezers, televisions, recorders and players, electric bulbs, tube-lights, fans, electric irons, washing machines and telephone sets 24 Household gas appliances, including cooking range, ovens, geysers and gas heaters 25 Foam or spring mattresses, and other foam products for household use 26 Auto parts and accessories sold in retail packing 27 Lubricating oils, brake fluid, transmission fluid, and other vehicular fluids and maintenance products in retail packing 28 Tyres and tubes 29 Storage batteries 30 Arms and ammunition 31 Paints, distempers, enamels, pigments, colours, varnishes, gums, resins, dyes, glazes, thinners, blacks, cellulose lacquers and polishes sold in retail packing 34 Tiles sold in retail packing 35 Biscuits, confectionary, chocolates, toffees and candies SRO 897(I)/2013 Through the above SRO, following amendments made in Sales Tax Special Procedure (Withholding) Rules, 2007 In rule 2 after sub-rule 2, sub-rule 2A inserted resultantly the withholding tax deduction reduced to 1/10th from the existing 1/5th on purchases from following registered persons: • Wholesaler • Dealer (including petroleum dealer) or • Distributor Sub-rule 3 substituted and following new rules 3(i) and 3(ii) inserted to allow different provisions for withholding agent having Free Tax Number (FTN) and other withholding agents. Detail is as under; Withholding agents having Free Tax Number (FTN) On purchases from un-registered persons, sales tax will be deducted equal to the applicable rate of the value of taxable supplies. Other withholding agents: On purchases from un-registered persons, sales tax will be deducted equal to one percent of the value of taxable supplies. Provided the withholding agent shall not be entitled to reclaim or deduct the amount of tax withheld from such persons as input tax Sub-rule 5 amended and following supplies exempted from withholding tax if supplied by registered persons; • Goods specified in 3rd schedule to the sales tax act, 1990 • Supplies made by commercial importers who paid value addition tax on such goods at the time of import. SRO 898(I)/2013 Through the above SRO, following further amendments made in its Notification No. S.R.O. 1125(I)/2011 dated the 31st December, 2011coverin five export oriented sectors; After condition vii, a new condition viia inserted resultantly import or supplies of fabric shall be charged to sales tax at the rate of three percent and value addition tax at the rate of two percent shall be charged on import by commercial importers. The proviso of condition x shall be substituted and resultantly refund against local supplies if any shall be admissible only subject to; • Pre-refund audit and • In case of value addition is less than ten percent then subject to the condition that the registered person furnishes a revolving bank guarantee valid for at least for ninety days issued by a scheduled bank to the satisfaction of the Commissioner of inland revenue equivalent to average monthly refund claimed during last twelve months. Provided post refund audit shall be conducted and finalized within a period of ninety days and certificate to the genuineness of the refund claim shall be issued for each and every claim by the Commissioner Inland Revenue.
Posted on: Mon, 07 Oct 2013 05:56:27 +0000
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