ISLAMABAD: The government has facilitated small businesses and increased the threshold of turnover up to Rs10 million from Rs3 million and they will not be required to get sales tax registration.
Finance Minister Shaukat Tarin while presenting federal budget 2021/2022 on Friday said that small businesses are the backbone of our economy as they create maximum job opportunities and provide subsistence to significant number of people, thus supporting economic growth.
To facilitate small businesses, threshold of annual turnover is being enhanced. Now a cottage industry having annual turnover of up to Rs 10 million will not be required to register for sales tax.
Previously, a small business having turnover of Rs 3 million per annum was required to register and face the hassle of filing monthly sales tax returns.
The finance minister also highlighted measures taken for ease of doing business.
The finance minister announced various schemes for ease of doing business such as:
(1) Allowing constructive payment for adjusting payable and receivable under section 73 of sales tax law;
(2) Doubling the tier-I retailer shop area requirement for furniture business;
(3) Enhancing the scope of compensation for delayed refunds; and
(4) Excluding advance payment from chargeability of sales tax.