Sales Tax Instructions

Sales Tax Instructions, 2009
most of the persons governed under the fixed tax regimes upto 30.6.1998 continued to
discharge their tax liabilities in accordance with the lapsed fixed tax notifications, and in
due course, the Simplified Sales Tax Rules, 1999 were notified vide SRO 458(I)99, dated
6.4.1999 which operated upto 30.06.1999. However, one category of taxpayers
previously covered under the fixed tax schemes was excluded from the Simplified Sales
Tax Rules, 1999 i.e. those with annual turnover in excess of Rs. 1 million. This
retrospective exclusion created difficulties for those persons who had been complying
under the old regime even after 1.7.1998. Now, the persons so excluded have been given
coverage under the Simplified Sales Tax Rules, 1999 during the period of its validity. It
is clarified that any person to whom the advantage of Simplified Sales Tax Rules, 1999
has thus been extended under this notification are also entitled, if otherwise qualified, to
the relief available under S.R.O. 392(I)/2001, dated 18.06.2001, notwithstanding the
provisions of item No. (iv) of rule 3 of the Simplified Sales Tax Rules, 1999.
4. S.R.O. 394(I)/2001, dated 18.06.2001:- This notification covers those
weaving units who were complying with an "informal" fixed tax scheme during 1996-97
and/or 1997-98 even though no formal notification had been issued to cover such activity
after 9.6.1994. As per verbal agreements between the government and the Pakistan Silk
& Rayon Mills Association, such weaving units paid sales tax @ Rs. 300 per loom on
automatic looms for 1996-97 and 1997-98 on a promise of subsequent compliance under
VAT mode. This notification, therefore, addresses the difficulties of such taxpayers in the
weaving sector for the period upto 30.6.1998.
5. S.R.O. 395(I)/2001, dated 18.06.2001:- The overwhelming bulk of
weaving and sizing sector remained completely outside the tax net till recently. The
recent compliance to GST requirements by such units was on the basis of verbal
assurances from the government to forgo their liabilities for the past. This notification has
been issued to take care of difficulties of such weaving and sizing units etc.
6. Guidelines:- In other to ensure that these notifications are not
misinterpreted or the relief admissible thereunder is not misused by any person, the
Collectorates are directed to follow the following instructions:-
i) The said notifications need to be understood in the right perspective.
They are not amnesty schemes but conditional relief notifications
covering precisely defined categories of taxpayers. They address the
technical objections faced by affected units due to transition from fixed
tax system to VAT mode. The determining factor is that such taxpayers
steadfastly remained registered and (generally) continued to comply,
albeit in a flawed manner;