Karachi, July 25, 2024 – The Sindh Revenue Board (SRB) has issued updated sales tax rates for services provided by professionals and consultants for the tax year 2024-25.
The new rates, effective after amendments made through the provincial Finance Act, 2024, aim to streamline the tax structure and clarify applicable rates and exemptions.
According to the SRB:
1. Medical Practitioners and Consultants:
o Standard Rate: A standard sales tax rate of 15% applies to services rendered by medical practitioners and consultants.
o Reduced Rate: A reduced rate of 3% is available for services other than those classified under the tariff heading 9842.0000, which pertains to cosmetic and plastic surgery. However, input tax credit/adjustment is not admissible at this reduced rate.
o Exemptions: Services provided by medical practitioners and consultants, except those involving cosmetic and plastic surgery, are exempt from tax if the consultation/visit fee does not exceed Rs. 3,000 per consultation/visit.
2. Legal Practitioners and Consultants:
o Standard Rate: Legal services are subject to a standard sales tax rate of 15%.
o Reduced Rate: A reduced rate of 8% is also available, but input tax credit/adjustment is not admissible.
3. Accountants and Auditors:
o Standard Rate: Services provided by accountants and auditors are taxed at a standard rate of 15%.
o Reduced Rate: A reduced rate of 8% is applicable to accounting and auditing services, with the stipulation that input tax credit/adjustment is not admissible.
o Exemptions: Services exported and delivered by registered accountants and auditors outside Pakistan are exempt from sales tax, provided the export value is received in foreign exchange through banking channels into the business bank accounts of the registered person and reported to the State Bank of Pakistan as prescribed.
The SRB’s issuance of these tax rates provides clarity for professionals and consultants regarding their tax obligations for the upcoming tax year. The differentiation between standard and reduced rates, along with specific exemptions, aims to support various professional services while ensuring compliance with tax regulations.
These updates are part of the SRB’s ongoing efforts to enhance the tax framework within Sindh, making it more transparent and easier for taxpayers to understand their liabilities. Professionals and consultants are encouraged to review these rates carefully to ensure accurate tax filing and compliance.
Stakeholders can access the detailed notification on the SRB’s official website for further information on the applicable tax rates and conditions for exemptions.