Sales Tax Instructions

Sales Tax Instructions, 2009
(v) There is, however, one exception to the foregoing. Under section 2
(46)(f), in case of processing of non-taxable raw materials, the value of
processed goods will be the open market price of finished goods and not
the processing charges alone.
2. All previous instructions/Circulars/General Orders on the subject may be
treated as withdrawn.
[Rescinded vide STGO No.3 of 2004 dated 12 th June, 2004]
[Issued by the CBR, Islamabad under the signature of Mr. Akhtar Ali, Secretary (STP)
vide C.No.2(3)STP/96.]
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C.No.5(1)STP/98 DATED 24 TH JUNE, 1998
SUBJECT:-
LEVY OF SALES TAX AT RETAIL STAGE.
I am directed to say that sales tax has been extended upto the retail stage in the
budget 1998-99, effective from 1 st July, 1998. All retailers whose total annual turnover,
whether from taxable goods or otherwise, exceeds five million rupees are required to be
registered with the Sales Tax Department by the 11 th July, 1998 and pay sales tax on their
taxable supplies w.e.f. 01.07.1998. Copy of detailed Federal Government Notification
No.S.R.O. 583(I)/98, dated 12 th June, 1998 is enclosed for ready reference.
2. It is requested that your organization may be got registered with the Sales
Tax Department and the concerned officials in the organization may be advised to charge
sales tax on taxable supplies and pay it to the Government through their quarterly returns
to be submitted in the designated branches of the National Bank of Pakistan. The tax is
chargeable @ 12.5%, however, input tax paid on purchases is adjustable. The price shall
be deemed to be inclusive of the sales tax as per formula laid down in the enclosed rules.
It may be pointed out here that your organization may obtain a single registration for the
head office (for all taxable activities of all its branches) instead of opting for registration
for each sales outlet under section 16 of the Sales Tax Act, 1990.
3. Any other query in this regard may be addressed to the concerned
Collector of Sales Tax who has already been advised to extend all possible help to the
registered persons. In case you feel that your officials need some training, requirements
of the same may be intimated to the said Collectorate which will make necessary
arrangements including seminars, lectures, briefing sessions, etc.
4. Your attention is also invited to the provisions of sub-clause (f) of clause
7 of the Finance Bill, 1998, which requires that all persons required to make deduction of
with-holding tax under section 50(4) of the Income tax Ordinance, 1979, shall make
purchases of taxable goods only from registered persons against tax invoices to be issued
by such suppliers. You are also requested to comply with the aforesaid provisions to
avoid penalties and also to get benefits of input tax adjustments.
5. It may be worthwhile to point out here that there are fixed penalties for
non-registration non-filing of return and non-payment of tax, besides the statutory