In a move aimed at providing convenience to taxpayers, the Federal Board of Revenue (FBR) has announced that individuals can now obtain duplicate documents of their sales tax affairs.
(more…)Tag: Sales Tax Act 1990
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Liability of the registered person for the acts of his agent
Section 68 of the Sales Tax Act, 1990, delves into the legal framework surrounding the liability of a registered person for the actions undertaken by their appointed agent.
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Provision to pay sales tax refunds through bonds
A provision has been added to Section 67A of the Sales Tax Act, 1990, which empowered the Federal Board of Revenue (FBR) to pay sales tax refund through bonds.
The Federal Board of Revenue (FBR) issued the Sales Tax Act, 1990 updated up to June 30, 2021. The Act incorporated amendments brought through Finance Act, 2021.
Following is the text of section 67A of the Sales Tax Act, 1990:
67A. Payment of refund through sales tax refund bonds.— (1) Notwithstanding anything contained in section 67, the sales tax refunds payable under this Act may also be paid through sales tax refund bonds to be issued by FBR Refund Settlement Company Limited, in book-entry form through an establishment licensed by the Securities and Exchange Commission of Pakistan as a central depository under the Securities Act, 2015, (111 of 2015), in lieu of payment to be made through issuance of cheques or bank debit advice.
READ MORE: SBP urged to direct banks for accepting sales tax refund bonds
(2) The Board shall issue a promissory note to FBR Refund Settlement Company Limited, hereinafter referred to as the company, incorporating the details of refund claimants and the amount of refund determined as payable to each for issuance of sales tax refund bonds, hereinafter referred to as the bonds, of the same amount.
(3) The bonds shall be issued in values in multiples of one hundred thousand rupees.
(4) The bonds so issued shall have a maturity period of three years and shall bear annual simple profit at ten per cent.
(5) The bonds shall be traded freely in the country’s secondary markets.
(6) The bonds shall be approved security for calculating the statutory liquidity reserve.
(7) The bonds shall be accepted by the banks as collateral.
(8) There shall be no compulsory deduction of Zakat against the bonds and Sahib-e-Nisab may pay Zakat voluntarily according to Shariah.
(9) After period of maturity, the company shall return the promissory note to the Board and the Board shall make the payment of amount due under the bonds, along with profit due, to the bond holders.
(10) The bonds shall be redeemable in the manner as in the preceding sub-section before maturity only at the option of the Board along with simple profit payable at the time of redemption in the light of general or specific policy to be formulated by the Board.
(11) The refund under sub-section (1) shall be paid in the aforesaid manner to the claimants who opt for payment in such manner.
(12) The Board, with the approval of the Federal Minister-in-charge, may notify procedure to regulate the issuance, redemption and other matters relating to the bonds, as may be required.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
READ MORE: FBR to pay additional amount on delayed sales tax refund
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FBR to pay additional amount on delayed sales tax refund
Federal Board of Revenue (FBR) is liable to pay an additional amount on a sales tax refund that is paid after a specified time under Sales Tax Act, 1990.
A procedure for the payment of an additional amount against delayed sales tax refund has been laid down under Section 67 of the Sales Tax Act, 1990.
The Federal Board of Revenue (FBR) issued the Sales Tax Act, 1990 updated up to June 30, 2021. The Act incorporated amendments brought through Finance Act, 2021.
Following is the text of section 67 of the Sales Tax Act, 1990:
67. Delayed Refund.– Where a refund due under section 10 is not made within the time specified in section 10 from the date of filling of refund claim, there shall be paid to the claimant in addition to the amount of refund due to him, a further sum equal to KIBOR per annum of the amount of refund due, from the date following the expiry of the time specified as aforesaid, to the day preceding the day of payment of refund:
Provided that where there is reason to believe that a person has claimed the refund which is not admissible to him, the provision regarding the payment of such additional amount shall not apply till the investigation of the claim is completed and the claim is either accepted or rejected:
Provided further that where a refund due in the consequence of any order passed under section 66 is not made within forty five days of date of such order, there shall be paid to the claimant in addition to the amount of the refund due to him, a further sum equal to KIBOR per annum of the amount of refund, due from the date of the refund order.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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Refund to be claimed within one year
Section 66 of Sales Tax Act, 1990 has described refund to be claimed within one year.
The Federal Board of Revenue (FBR) issued the Sales Tax Act, 1990 updated up to June 30, 2021. The Act incorporated amendments brought through Finance Act, 2021.
Following is the text of section 66 of the Sales Tax Act, 1990:
66. Refund to be claimed within one year.– No refund of tax claimed to have been paid or over paid through inadvertence, error or misconstruction or refund on account of input adjustment not claimed within the relevant tax period, shall be allowed, unless the claim is made within one year of the date of payment:
Provided that in a case where a registered person did not deduct input tax within the relevant tax period, the Commissioner may, after satisfying himself that input tax adjustment is due and admissible, allow the registered person to take such adjustment in the tax period as specified by the Commissioner:
Provided further that in a case where the refund has become due on account of any decision or judgement of any officer of Inland Revenue or court or the Tribunal, the period of one year shall be reckoned from the date of judgement or decision of such officer, court or Tribunal:
Provided further that the application or claim filed under this section shall be disposed of within a period not exceeding ninety days from the date of filing of such application or claim.
Provided also that no refund shall be admissible under this section if incidence of tax has been passed directly or indirectly to the consumer.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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Exemption of tax not or short levied
Section 65 of Sales Tax Act, 1990 has explained exemption of tax not levied or short levied as a result of general practice.
The Federal Board of Revenue (FBR) issued the Sales Tax Act, 1990 updated up to June 30, 2021. The Act incorporated amendments brought through Finance Act, 2021.
Following is the text of section 65 of the Sales Tax Act, 1990:
65. Exemption of tax not levied or short levied as a result of general practice.– Notwithstanding anything contained in this Act, if in respect of any supply the Federal Government is satisfied that inadvertently and as a general practice: –
(a) tax has not been charged in any area on any supply which was otherwise taxable, or according to the said practice the amount charged was less than the amount that should have actually been charged;
(b) the registered person did not recover any tax prior to the date it was discovered that the supply was liable to tax; and (c) the registered person started paying the tax from the date when it was found that the supply was chargeable to tax;
It may, by a notification in the official Gazette, direct that the tax not levied or short levied as a result of that inadvertent practice, shall not be required to be paid for the period prior to the discovery of such inadvertent practice.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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FBR may prohibit drawback in case of foreign territory
In a move that could have significant implications for exporters, the Federal Board of Revenue (FBR) is contemplating the prohibition of drawback against goods exported to specified foreign territories.
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Drawback into use between import and re-export
Section 63 of the Sales Tax Act, 1990, sheds light on the provision of drawback in the form of sales tax repayment for goods that have been utilized between their importation and subsequent re-exportation.
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Drawback allowable on re-export
Section 62 of Sales Tax Act, 1990 has described drawback allowable on re-export.
The Federal Board of Revenue (FBR) issued the Sales Tax Act, 1990 updated up to June 30, 2021. The Act incorporated amendments brought through Finance Act, 2021.
Following is the text of section 62 of the Sales Tax Act, 1990:
62. Drawback allowable on re-export.– When any goods which have been imported into Pakistan and on which tax has been paid on importation are re-exported outside Pakistan and such goods as are capable of being identified, seven-eighth of such tax shall, except as otherwise hereinafter provided, be repaid as drawback, and the provisions of Customs Act, 1969 (IV of 1969), relating to drawback of customs duties shall, so far as may be apply to such tax, as they apply for the purposes of that Act:
Provided that no such drawback shall be repaid unless the re-export is made within a period of two years from the date of importation as shown in the records of the Custom House:
Provided further that the Board may, on sufficient cause being shown, in any case extend the said period by a further period of one year.
(Disclaimer: The text of above section is only for information. Team PkRevenue.com makes all efforts to provide the correct version of the text. However, the team PkRevenue.com is not responsible for any error or omission.)
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Repayment of tax to registered persons
In a move aimed at fostering economic development in Azad Jammu and Kashmir (AJK), the Federal Board of Revenue (FBR) has introduced a provision allowing for the repayment of tax to individuals and businesses registered in the region.
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