Tag: SRB

SRB suspends sales tax registration of M/s. Ability Logistics International

KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of M/s. Ability Logistics International for failure to pay taxes and non-compliance of filing monthly returns.

The SRB said that scrutiny of tax profile of the taxpayers showed that, it had failed to electronically file true and correct Sindh Sales Tax Return for the period October 2012 to December 2019.

The provincial revenue authority said that the sales tax registration of the company had been suspended with immediate effect.

The sales tax registration shall be revoked if the taxpayer takes remedial action by January 30, 2020. The remedial action should include to discharge sales tax liability along with default surcharge for the aforementioned periods and shall also deposit the same with the government of Sindh.

Further, the logistic company is also required to electronically file true and correct monthly sales tax returns for the said tax periods.

The provincial revenue body said that in case of non-satisfactory response or failure to take remedial measures on or before January 30, 2020, the case shall be further proceeding for cancellation of the registration with the SRB.

January 28, 2020
SRB suspends sales tax registration of Arabia Sea Country Club

KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of Arabian Sea Country Club for tax fraud.

In a notice for suspension of registration of M/s. Arabia Sea Country Club, the SRB said that the taxpayer had collected the amount of tax on services provided but did not deposit to the provincial exchequer.

The SRB said that the taxpayer provided services to M/s. Aisha Steel Mills Limited, M/s. Master Motors, M/s. Novartis Pharma (Pakistan) Limited, M/s. Naveena Steel Mills (Pvt) Limited, M/s. Yamaha Motor Pakistan (Pvt) Limited, M/s. L’oreal Pakistan Pvt Limited amounting to Rs11,615,885 involving Sindh sales tax of Rs1,510,067 for the tax period January 2019 to October 2019.

“It is inform you that the aforesaid act of non-payment/short payment of Sindh sales tax is covered under the ‘tax fraud’ as defined under the provision of Section 2(94) of the Act, 2011.”

The SRB has given deadline of January 28, 2020 to the taxpayer:

To discharge all the due Sindh sales tax liability along with default surcharge; and

To e-file the true and correct monthly Sales Tax return for the said tax periods.

“In case of non-satisfactory response or failure to take remedial measures as suggested above on or before January 28, 2020, the case shall be processed for cancellation of registration.”

January 24, 2020
Insurance agents liable to pay 13% sales tax on services

KARACHI: Sindh Revenue Board (SRB) has said that insurance agents are liable to pay 13 percent sales tax on services provided or rendered to their clients.

The SRB issued updated working tariff for tax year 2020 and notified sales tax rate for various services. According to the working tariff the insurance agents are liable to pay 13 percent sales tax on services provided or rendered.

However, a reduced rate of five percent is available to insurance agents with condition that input tax credit shall not be admissible.

The SBR also notified sales tax rate for other services such as electric power transmission services liable to 13 percent sales tax on services.

The provincial revenue body said that vehicle parking and valet services liable to 13 percent sales tax on services. However, a reduced rate of five percent also available with condition that input tax credit shall not be admissible.

The rate of 13 percent sales tax applicable on: actuarial services; services of mining of mineral and allied and ancillary services in relation thereto; site preparation and clearance, excavation and earth moving and demolition services; waste collection and management services; warehouse or depots for storage or cold storages; supply chain management or distribution, including delivery) services.

The services provided or rendered by cab aggregator and the services provided or rendered by the owners of drivers of the vehicles using the can aggregator services are liable to 13 percent sales tax. A reduced rate of 5 percent of such services is also available with condition that the input tax credit shall not be admissible.

January 24, 2020
Sales tax rates on services provided by goods transportation

KARACHI: Sindh Revenue Board (SRB) has issued updated working tariff for tax year 2020 and notified sales tax rates on services provided or rendered by persons engaged in inter-city transportation.

According to the SRB, the sales tax shall be 13 percent on services provided or rendered by persons engaged in inter-city transportation or carriage of goods by road or through pipeline or conduit.

However, this rate shall be reduced at 8 percent with the condition that input tax credit/adjustment shall not be admissible.

The sales tax rate shall be 13 percent on services provided or rendered by persons engaged in inter-city transportation or carriage of goods by road through truck addas or through bus/wagon stands excluding road transportation or carriage of goods through addas or through bus/wagon stands excluding road transportation of

(i) petroleum oils through oil tankers;

(ii) automotive vehicles, classified under tariff headings of Chapter 87 of the First Schedule to the Customs Act, 1969, as are transported or carried through specialized vehicle carriers; and

(iii) Goods and cargo through vehicles operated by Fleet Logistic Companies having not less than 25 vehicles in its fleet

The reduced rate of three percent is allowed with condition that input tax credit shall not be admissible.

These services are also exempt from sales tax on following:

Services provided or rendered by persons engaged in inter-city transportation of goods by road during the period from July 01, 2014 to the June 30 ,2015, provided that :

(a) Such person has neither billed /involved/ charged the service recipient any amount of tax nor collected or received any amount of tax from the service recipient on account of such transportation or carriage services as were provided during the said Period;

Provided further that the amounts of tax billed or invoiced or charged or received or collected, if any, by the such person for the services provided or rendered during the period from the 1st July,2014 to the 30th June, 2015, are e-deposited in Sindh, Government’s head of account “B-02384” in the prescribed manner on or before the 15th day of July, 2015.

(b) Such person gets e-registered with the SRB on or before 25th day of July, 2015, in accordance with the provisions of section 24 of the Act, read with the rules prescribed thereunder; and

(c) this exemption shall not entitle any exemption benefit or any claim for refund of the amount of tax already deducted or withheld or paid or deposited by any person in relation to the services provided or rendered or received or procured during the period from 01st day of July, 2014 to the 30th day of June, 2015. Such amount shall be deemed to be the tax under section 16 of the Act and shall be e-deposited in Sindh Government head of account “B-02384” in the prescribed manner on before the 15th day of July, 2015, failing which it shall be recovered alongwith penalty and surcharge as prescribed in the Act.

January 22, 2020
Sales tax rate on services provided by laundries, dry cleaners

KARACHI: Sindh Revenue Board (SRB) has issued updated working tariff for tax year 2020 and notified sales tax rate on services provided by laundries and dry cleaners.

According to the working tariff the sales tax rate is 13 percent on services provided by laundering and dry cleaners.

However, a reduced rate of five percent also allowed on services provided or rendered by stand-alone laundries and dry cleaners.

Explanation: For the purpose of this notification, “Stand-alone laundries and dry cleaners” means a laundry and dry cleaner:-

(a) which does not provide any taxable service other than the services described against tariff heading No. 9811.0000;and

(b) which or any outlet/branch of which is not located with the building premises or precincts of a hotel, motel, guest house or club whose service are liable to tax.

Input tax credit adjustment shall not be admissible against reduced rate of sales tax.

The SRB also exempted the sales tax on services provided or rendered by laundries or dry cleaners for following categories:

(a) laundries and dry cleaners located within the building premises and premises of a hotel, motel, guest house or club whose services are liable to tax;

(b) laundries and dry cleaners which have franchisers or franchisees;

(c) laundries and dry cleaners having any branch or more than one outlet in Sindh;

(d) laundries and dry cleaners whose turnover exceeds 2.5 million rupees in a financial year; and

(e) laundries and dry cleaners whose total utility (electric, gas and telephone) bills does not exceed Rs. 25,000/- in any month during a financial year.

January 21, 2020
Sales tax rate on services provided by fashion designers

KARACHI: Sindh Revenue Board (SRB) issued updated working tariff for tax year 2020 and notified sales tax rate on fashion designers.

The services provided or rendered by fashion designers shall be 13 percent. The SRB does not provide any reduced rate for this service category.

The FBR said the services provided by race club shall be subject to 13 percent sales tax. However, the services of entry/admission the sales tax shall be charged at Rs200 per entry ticker or entry pass of the person visiting the race event.

The SRB said that services provided or rendered by program producers and production houses shall be 13 percent. However, reduced rate of eight percent with condition that the input tax adjustment shall not be admissible.

Similarly, service provided or rendered by corporate law consultants the tax rate shall be 13 percent. However, the reduced tax rate of eight percent is available with condition that the input tax credit shall not be admissible.

The tax rate is 13 percent for services provided or rendered by call centers.

The reduced rate at 3 percent is available on:

1. Services provided or rendered by a call center from a place of business in Sindh for which the registered person receives the value of the services from a place outside Pakistan in foreign exchange through banking channels in the business bank account of the registered person in the manner prescribed by the State Bank of Pakistan.

2. Input tax credit shall not be admissible.

January 21, 2020
Sales tax rate on services provided by stock brokers

KARACHI: Sindh Revenue Board (SRB) has updated working tariff for tax year and notified tax rates for services provided or rendered by specified persons or businesses.

According to updated working tariff, the sales tax rates shall be applicable for following services:

Stock brokers and commodity brokers shall pay sales tax at 13 percent on services provided or rendered by them.

Underwriters shall be sales tax at the rate of 13 percent on services.

Indenters are also required to pay 13 percent sales tax on services. However, services provided by indenters are subject to reduced rate of three percent sales tax on:

1. Services provided or rendered by an indenter from a place of business in Sindh for which the registered person receives the value of the services from a place outside Pakistan in foreign exchange through banking channels in the business bank account of the registered person in the manner prescribed by the State Bank of Pakistan.

2. Input tax credit/adjustment shall not be admissible.

The sales tax rate shall be 13 percent on services provided by commission agents.

Similarly, the rate of sales tax shall e 13 percent on services provided or rendered by packers and movers.

Money changers are required to pay 13 percent sales tax on services However, there is exemption available on service provided or rendered by money changers in consideration of ‘spread’ charges as permitted by the State Bank of Pakistan in relation to the buying and selling of foreign currencies.

January 20, 2020
Sales tax rate on services provided by property developers

KARACHI: Sindh Revenue Board (SRB) has issued updated working tariff for tax year 2020 under which 13 percent sales tax is applicable on services rendered by property developers.

According to the working tariff the tax rate shall be 13 percent on services provided or rendered by property developers or promoters for:

a. development of purchased or leased land for conversion into residential or commercial plots.

b. construction of residential or commercial units.

However, reduced rates are available at Rs100 per square yard of land in case of (a) and Rs50 per square foot of constructed covered area in case of (b). However, on availing reduced rate of sales tax the input tax credit adjustment shall not be admissible.

The SRB said that services provided or rendered by persons engaged in contractual engaged execution of work of furnishing supplies, the sales tax shall be 13 percent.

However, this rate is exempted on services provided or rendered by persons engaged in contractual execution of work of furnishing supplies:

i) whose annual turnover does not exceed 4 million rupees in a financial year; and

(ii) in relation to the text books, published for free distribution amongst students free of cost, against the order of Sindh Textbook Board subject to the conditions that the Sindh Textbook Board:-

(a) assigns the work to a person duly registered under the Sindh Sales Tax on Services Act, 2011; and

(b) Furnishes, to the Sindh Revenue Board, statement on quarterly basis, showing name of person/contractor, SNTN, value of such contract, alongwith certificate about the free of cost distribution of such textbooks amongst the students.

January 19, 2020
Rate of sales tax on banking services

KARACHI: Sindh Revenue Board (SRB) has issued updated working tariff for tax year 2020 which showed banks to pay 13 percent on sales tax regarding various services provided to customers.

According to working tariff the sales tax shall be charged at 13 percent on services provided or rendered by banking companies in relations:

Guarantee including bank guarantee

Brokerage

Letter of credit

Issuance of cheque books, pay order and demand draft

Bill of exchange

Transfer of money including telegraphic transfer, mail transfer and electronic transfer

Commission including bill discounting commission

Safe deposit lockers and safe vaults

Other services not elsewhere specified

Issuance, processing and operation of credit and debit cards

Commission and brokerage of foreign exchange dealings

Automated Teller Machine operations, maintenance and management

Service provided as banker to an issue

Others, including the services provided or rendered by non banking, finance companies, modaraba and musharika companies and other financial institutions.

January 18, 2020
Sales tax exemption allowed to certain personal care services

KARACHI: Sindh Revenue Board (SRB) has issued updated working tariff for tax year 2020, which showed certain sales tax exemptions are available on personal care services.

According to the working tariff, services provided or rendered for personal care by beauty parlors, beauty clinics, slimming clinics or centers and other are subject to sales tax at 13 percent.

However, such services are available at reduced rate of 10 percent but with condition that input tax adjustment shall nto be allowed.

The provincial revenue authority, however, allowed exemption with conditions:

01. Persons providing the services of hair cutting, hair dressing and hair dyeing and shaving provided that they do not provide any other beauty treatment, beauty care, beauty parlour or beauty clinic service.

2. Services provided or rendered by beauty parlors/clinics and slimming clinics whose turn over does not exceed Rs2.5 million in a financial year:

Provided that the exemption shall not apply in case of the beauty parlour/clinics and sliming centers:-

(i) which are located within the building premises or precincts of a hotel, motel, guest house or club whose services are liable to tax;

(ii) which are franchisers or franchisees;

(iii) which have any branch or have more than one outlet in Sindh; and

(iv) whose total utility (electricity, gas & telephone) bill exceeds Rs25,000/- in any month during a financial year.

Provided that the exemption shall not apply in case of the beauty parlor/clinics and sliming centers:-

(v) which are located within the building premises or precincts of a hotel, motel, guest house or club whose services are liable to tax;

(vi) which are franchisers or franchisees;

(vii) which have any branch or have more than one outlet in Sindh; and

(viii) whose total utility (electricity, gas & telephone) bill exceeds Rs25,000/- in any month during a financial year.

January 18, 2020