Sales Tax Instructions

Sales Tax Instructions, 2009
international tenders. Such supplies shall be treated as zero
rated.
(6) Exemption on supplies to Armed Forces.-- The scope of
exemption on supplies of Defence Stores to Armed Forces is
being enlarged. Exemption of sales tax is being allowed on
trucks, their parts and accessories assembled or manufactured by
local manufactures for supply to Armed Forces.
(7) Exemption of sales tax on goods supplied under grants-inaid.--
Previously only goods imported under grants-in-aid were
eligible for exemption of sales tax. Now even the goods
supplied locally under grants-in-aid will be entitled to exemption
of sales tax.
(8) Extension of sales tax exemption on supplies and imports
under agreements.-- The time limit for exemption of sales tax
on imports and local supplies under agreements is being
extended upto 30 th June, 1996 provided the agreements
contained the provision for exemption of sales tax at the time of
signing of agreement.
(B)
LEGAL AND PROCEDURAL CHANGES.
2. Certain changes have been made in the Sales tax,. 1990, to remove
certain legal complications and to regularize the changes effected in the Act through
Sales Tax (Amendment) Ordinances. Salient features of these legal changes are given
below:-
(1) Regularization of Ordinances.-- Sales Tax (Amendment)
Ordinance, 1997 and Sales Tax (Third Amendment) Ordinance,
1996, are being regularized through Finance Bill, 1997.
(2) Omission of First Schedule.-- The First Schedule carrying rate
of 23% on 26 items is being omitted. All these items will now
be charged to tax at the standard rate of 12.5%.
(3) Amendment in the Fifth Schedule.-- A new entry is being
added in the Fifth Schedule to declare the supplies made against
international tenders as zero rated. As a consequence, all
supplies made against international tenders will be deemed
exports, hence chargeable to tax at the rate of zero per cent.
(4) Exemption on supply of trucks to Armed Forces. -- Entry
No.20 in the Sixth Schedule is being amended to provide for
exemption on trucks, their parts and accessories assembled or