Sales Tax Instructions

Sales Tax Instructions, 2009
2. It is, therefore, concluded that legally, withholding tax is an advance
collection of income tax, charged from the consumers of natural gas. It is not levied on
the consumption of gas, and thus cannot be included in the value of supply of gas. Hence,
sales tax cannot be levied or collected on the said withholding tax charged on gas
consumption bills.
[Amended by Sales Tax Ruling/ Instructions No. 11/2003 dt. 12.05.2003]
[Issued by the CBR, Islamabad under the signature of Dr. Ashfaq Ahmed Tunio,
Secretary (ST L&P) addressed to the Collector of Sales Tax, Lahore. Copy endorsed to all other
Collectors of Sales Tax.]
C.No.3(36)STP/99(Pt-I) DATED 28 TH FEBRUARY, 2001
SUBJECT:-
INPUT TAX ADJUSTMENT WITHOUT ACTUAL PAYMENT OF
INPUT TAX TO SUPPLIER.
I am directed to refer to your letter C.No.87/Audit/ST/W/ V/2000/0560, dated
27 th January, 2001 on the above cited subject and to say that section 7(1) of Sales Tax
Act, 1990 entitles the registered person to deduct input tax paid during the tax period for
the purpose of taxable supplies made or to be made by him. The word ―paid‖ reflects that
input adjustment can only be taken if the amount is actually paid by the claimants in
terms of section 73 of the Sales Tax Act, 1990. Therefore, the views of the Collector are
endorsed by the Board. It is, however, added that draft rules for credit transactions are
already under consideration and will be issued soon to resolve the genuine problems of
the taxpayers in case of credit transactions.
[Issued by the CBR, Islamabad under the signature of Dr. Ashfaq Ahmed Tunio,
Secretary (ST L&P) addressed to the Collector of Sales Tax (West), Karachi. Copy endorsed to
all other Collectors of Sales Tax.]