The Federal Board of Revenue (FBR) has updated the Sales Tax Act, 1990 to make sales tax registration mandatory for various entities during the tax year 2024.
Section 14 of the Sales Tax Act, 1990 has categorized persons for mandatory registration.
Who is required to register for sales tax?
The following entities are required to register for sales tax in Pakistan:
• Manufacturers (other than cottage industries)
• Retailers who are liable to pay sales tax
• Importers
• Exporters who intend to obtain sales tax refund against their zero-rated supplies
• Wholesalers, dealers, and distributors
• Persons who are required to be registered for the purpose of any duty or tax collected or paid as if it were a levy of sales tax
How to register for sales tax?
To register for sales tax, you can visit the FBR website and fill out the online registration form. You will need to provide the following information:
• Your name and address
• Your business name and address
• Your National Tax Number (NTN)
• The nature of your business
• The type of goods or services you supply
• Your annual turnover
Once you have submitted the registration form, you will receive a registration certificate from the FBR.
Benefits of sales tax registration
There are several benefits to sales tax registration, including:
• You can obtain sales tax refunds on your zero-rated supplies.
• You can claim input tax credit on the sales tax you pay on your purchases.
• You can avoid penalties for non-registration.
Penalties for non-registration
If you are required to register for sales tax and fail to do so, you may be subject to a penalty of up to 100% of the sales tax you should have paid.
Conclusion
If you are unsure whether or not you are required to register for sales tax, you can contact the FBR for assistance.
