Sales tax rate on services provided by stock brokers, money changers

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.

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