Sales Tax Instructions

Sales Tax Instructions, 2009
I am directed refer to your letter No. 5(1)/STW/Tech/98/2941, dated 09.09.1998
on the subject cited above and to say that vide entry at serial No. 4 of the fifth schedule to
Sales Tax Act, 1990, supplies against international tenders are to be charged to sales tax
of zero percent in terms of section 4 thereof.
2. However, M/s Johnson and Phillips (Pakistan) Limited are required to
pay sales tax on import of the raw materials for the manufacture of goods (subsequently
to be supplied against international tender). If such goods were allowed to be imported
tax free, this will negate the very concept of zero-rating in a VAT system. Such customs
and central excise types of duty-free clearances are not in line with the VAT- mode of ST
system.
3. In view of the forgoing, CBR does not endorse your recommendation in
the matter. You are, however, advised to be ensured that there is no delay in payment of
zero-rated refund claims on merits, on supplies made by M/s. JOHNSON & PHILLIPS
against international tenders.
[Issued by the C.B.R. Islamabad under the Signature of Mr.Muhammad Tahir secretary
(STP), addressed to The Collector of Sales Tax (West). street No. 18/A, Block-6 Gulshan-e-Iqbal.
NIPA Chowrangi University Kar achi.]
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C.No.3(28)STP/98 DATED 28 TH SEPTEMBER, 1998
SUBJECT:-
VOLUNTARY REGISTRATION UNDER SECTION 18 OF THE
SALES TAX ACT, 1990 – LEVY OF 1% FURTHER TAX UNDER
SECTION 3(1A) THEREOF.
Eversince the imposition of 1% further tax under section 3(1A) of the Sales Tax
Act, 1990, units, not otherwise liable to registration, have started submitting applications
for voluntary registration under section 18 thereof to save themselves from the levy of
1% further tax.
2. Section 18(1) prescribes for voluntary registration at the option of a
person who makes or intends to make taxable supplies but is not required to be registered.
The requirement for registration is given in section 14. ―Taxable supply‖ is defined in
section 2(41) as ―other than a supply of goods which is exempt under section 13‖.
3. A question has arisen whether:-
(a)
(b)
Person making supply of goods exempt under section 13 are entitled to
voluntary registration under section 18(1); and
on such voluntary registration, they have to fulfill all duties and
responsibilities (e.g. filing of returns, etc) as is assigned to a ―registered
person‖ under the Act and also to avail of the benefits (e.g. non-payment