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  • Sindh Revenue Board suspends sales tax registration of 18 construction companies

    Sindh Revenue Board suspends sales tax registration of 18 construction companies

    KARACHI: Sindh Revenue Board (SRB) has suspended registration of 18 construction companies for defaulting tax payments and failure to file monthly sales tax returns.

    The SRB has directed the companies to make compliance with the provincial tax laws by March 12, 2020 otherwise their cases would be proceeded for cancellation.

    Following companies have been suspended for non-compliance:

    01. M/S CATALYST ENGINEERING SERVICES

    02. M/S START CONSTRUNCTION COMPANY

    03. M/S. A.H BUILDERS & CONSTRUCTION COMPANY

    04. M/S. ROCCRETE CONSTRUCTION & CO

    05. M/S. GUL MEMON CONSTRUCTION COMPANY (GOVERNMENT CONTRACTOR)

    06. M/S. JD BUILDERS

    07. M/S ABDULLAH RAHOO & COMPANY

    08. M/S MUHAMMAD AYOOB ENTERPRISES

    09. M/S MALIK NAVEED CONSTRUCTION COMPANY

    10. M/S SHOUKAT ALI & COMPANY

    11. M/S MUMTAZ ALI KHUSKH (GOVERNMENT CONTRACTOR)

    12. M/S JUMAN S/O ALLAH BACHAIO SHEEDI

    13. M/S RAMEEZ RAJA CONSTRUCTION COMPANY

    14. M/S A.KAREEM & SONS

    15. M/S MALIK MUHAMMAD SAEED GOVT & CIVIL CONTRACTOR

    16. M/S REMIX CONSTRUCTION

    17. M/S BISMILL CONSTRUCTION CONTRACTING COMPANY

    18. M/S MEHRAJ COMPANY

    During suspension period the companies are unable to deal with registered persons and also not able to get government contracts.

  • SRB suspends sales tax registration of shipping company

    SRB suspends sales tax registration of shipping company

    KARACHI: The Sindh Revenue Board (SRB) has taken decisive action by suspending the sales tax registration of M/s. Adam Shipping (Private) Limited, a shipping company, due to default in payment and failure to file monthly returns.

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  • SRB probes foreign transactions of goods carrier, suspends sales tax registration

    SRB probes foreign transactions of goods carrier, suspends sales tax registration

    KARACHI: Sindh Revenue Board (SRB) has launched investigation into identifying source of foreign transactions by a goods carrier company. Further the SRB suspended the sales tax registration of the company for filing untrue monthly statement.

    The SRB on Monday said that it had suspended sales tax registration of M/s. 3 Unicorns Private Limited for concealing facts in its monthly statements.

    The SRB said that available records of the company revealed that it had declared foreign income of around Rs37 million (in its income tax return) for the tax periods from July 2016 to June 2017, and has received consideration of Rs109 million for the tax periods from July 2016 up to February 2019 in his business bank account maintained under the title of ‘3 Unicorns Pvt Ltd’ in Bank Al Habib Limited, as declared in his registration profile.

    Furthermore, the official website of the company revealed that the registered person also provides customs brokerage and customs clearance services and transportation services from Karachi to Afghanistan.

    However, t is observed that the registered person has continuously filed Null sales tax return with the SRB during the aforementioned tax periods i.e. July 2016 to February 2019 despite receiving aforementioned huge consideration in his bank account which was voluntarily declared in registration form.

    “The registered person has failed to justify the aforesaid Null declarations and has failed to provide details of sales and purchases till date which shows mala fide intention on part of the registered person towards short payment of SST and violation of Section 8, 9 and 30 of the Act.”

    The SRB said that non-payment of Sindh sales tax and non-filing of true and correct sales tax return within the time and manner prescribed under the law is contravention of provisions of the Act and rules made thereunder.

    Therefore, this notice is being issued under Section 25 of the Act, 2011 to the effect that registration status of M/s. 3 Unicorns Pvt Ltd is hereby temporary suspended with immediate effect, which shall be revoked if he takes remedial actions by February 14, 2020.

    The SRB directed the company to submit copies of complete annual accounts statement for the financial year 2016/2017, 2017/2018 and 2018/2019 with details of sales and purchases.

    The company has been asked to provide details of transactions with sources of amounts received for the tax periods from July 2016 up to January 2020.

    Reconcile all Sindh sales tax dues of the aforementioned tax periods and deposit along with default surcharge. Further, the company also has been directed to provide copies of rent agreements for the periods.

    “In case of non-satisfactory response or failure to take remedial measures as suggested above on or before aforementioned date, further necessary action shall be taken as envisaged under the Act,” the SRB said.

  • Sindh introduces 5% sales tax reduced rate for healthcare services

    Sindh introduces 5% sales tax reduced rate for healthcare services

    KARACHI: Sindh Revenue Board (SRB) on Thursday introduced a reduced rate sales tax at five percent for various healthcare services with compliance of certain conditions.

    The provincial revenue body issued notification SRB-3-4/7/2020 to announce the reduced rate at five percent instead of 10 percent. The normal sales tax rate on services prevailed in Sindh province is 13 percent.

    The SRB said that the reduced rate of five percent shall be available on the services provided or rendered by healthcare centers, gym or physical fitness centers, etc., who have submitted their option or election on Form G as prescribed under rule 42CC of the Sindh Sales Tax on Services Rules, 2011 and fulfill the limitation, conditions and restrictions prescribed in the provisos to sub-rules (4), (5) and (6) thereof.

    The SRB said that the reduced rate at five percent is to those services on compliance of conditions, included:

    01. The registered person electronically submits his election or option in Form G by the prescribed due date;

    02. The registered person installs Point of Sale (POS) machine for electronic issuance of the invoices or receipts and gets all such machines linked up with SRB web portal to the satisfaction of SRB;

    03. The registered person issues his tax invoices/bills of charges or receipts electronically and no tax invoice/bill of charges or receipts is issued otherwise except through the POS of the registered person; and

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

  • SRB announces 5% sales tax reduced rate for personal care services

    SRB announces 5% sales tax reduced rate for personal care services

    KARACHI: Sindh Revenue Board (SRB) on Thursday announced a reduced rate sales tax at five percent for various personal care services with compliance of certain conditions.

    The provincial revenue body issued notification SRB-3-4/7/2020 to announce the reduced rate at five percent instead of 10 percent. The normal sales tax rate on services prevailed in Sindh province is 13 percent.

    The SRB said that the reduced rate of five percent shall be available on the services provided or rendered by such beauty parlours, beauty clinics, slimming clinics, body massage centers, pedicure centers etc. who have submitted their option or election on Form B as prescribed under rule 42C of the Sindh Sales Tax on Services Rules, 2011, and fulfill the limitations, conditions prescribed in the proviso to sub-rules (3A), (3B) and (4) thereof.

    The SRB said that the reduced rate at five percent is to those services on compliance of conditions, included:

    01. The registered person electronically submits his election or option in Form B by the prescribed due date;

    02. The registered person installs Point of Sale (POS) machine for electronic issuance of the invoices or receipts and gets all such machines linked up with SRB web portal to the satisfaction of SRB;

    03. The registered person issues his tax invoices/bills of charges or receipts electronically and no tax invoice/bill of charges or receipts is issued otherwise except through the POS of the registered person; and

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

  • SRB exempts sales tax on low cost housing projects

    SRB exempts sales tax on low cost housing projects

    KARACHI: The Sindh government has exempted sales tax on services provided or rendered to low cost housing projects funded by the federal government or Sindh government.

    Sindh Revenue Board (SRB) issued notification No. 3-4/04/2020 dated January 21, 2020.

    According to the notification: “construction relating to such of the low cost affordable public housing projects as are sponsored and funded by the federal government or by the government of Sindh subject to the condition that the houses are built or constructed on plots of up to 125 square yards or the covered area of each of the apartments and flats, so built or constructed under the project, does not exceed 900 square feet.”

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

    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.

  • SRB suspends sales tax registration of Arabia Sea Country Club

    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.”

  • Insurance agents liable to pay 13% sales tax on services

    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.

  • Sales tax rates on services provided by goods transportation

    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.