Sales Tax Instructions

Sales Tax Instructions, 2009
Bolts to complete a ‗fastener‘ should have been included in the aforesaid Notification as Washer
fortifies the grip of the nut and bolt and is independently of no use.
The ‗Washer‘ is being taxed at standard rate instead of a fixed rate in the cases of M/s. A. F.
Industries, which is a departure from equity, natural justice and fairplay.According to meaning
laid down on page 1212 of Concise Oxford Dictionary, washer means flat ring or perforated piece
of leather, metal or rubber used to give tightness to joint, nut fastening etc. The Washer is
classified under P.C.T. Heading 7318.1500 as per explanatory note given in the Harmonized
Commodity description and Coding System Vol. (3) under ‗E‘ washer is usually small, thin discs
with a hole in the center.
In the light of foregoing position, it may kindly be clarified whether a ‗Washer‘ is a part of a
‗fastener‘ or not and whether it is to be taxed under fixed tax Notifications or at standard rate.
An early response in the matter will be highly appreciated.
CH. ABDUL RAZZAQ,Advocate,
For M/s. A. F. Industries (Pvt.)Ltd, Lahore.
********
No.1(77)STAIU/90 DATED 28 TH JANUARY, 1999
SUBJECT:- CLARIFICATION REGARDING LEVY OF GENERAL SALES
TAX ON SALES OF EMPTY BITUMEN DRUMS.
I am directed to refer to your letter No.CDA/DA-Pro-2(13)/ 98/184, dated 28 th
December, 1998 on the above subject and to say that:-
(a)
(b)
(c)
In all those cases where contracts were made prior to 30 th June, 1998 and
supplies were made on or after 1 st July, 1998 and payments were also
received on or after 1 st July, 1998, the sales tax is leviable @ 12.5% upto
30 th November, 1998 and @ 15% on or after 1 st December, 1998;
In cases where contracts were made prior to 1 st July, 1998 and payments
(in full) were also received prior to 1 st July, 1998, but supplies were
made on or after 1 st July, 1998, no sales tax is leviable. However, if any
part payment was received on or before 30 th June, 1998, sales tax on
goods supplied on or after 1 st July, 1998 shall pay the sales tax due in
terms of section 2(44) of the Sales Tax Act, 1990.
The sales tax law does not envisage any pecuniary limit/ threshold for
levy of sales tax on auctionable goods purchased by such persons who
come under the definition of wholesaler, dealer, distributor, stockists or
suppliers. Therefore, sales tax shall have to be charged/paid irrespective
of the value/price of taxable goods being sold/auctioned.
[Issued by the CBR, Islamabad under the signature of Mr. Muhammad Tahir, Secretary
(STP) addressed to The Director (Audit & Accounts), Capital Development Authority, Islamabad.
Copy for information and necessary action to M/s Electrical Industries, Gujrat, with reference to
his letter number nil, dated 30 th November, 1998 on the subject cited above. Copy also endorsed to
the Collectors of Sales Tax, Islamabad/Gujranwala.]
********