Sales Tax Instructions

Sales Tax Instructions, 2009
Ans.
Provisions of section 59 of the Sales Tax Act, 1990 are
applicable for the purpose of input tax adjustment by the new registrants.
(iii) It is not clear whether tax should be charged at 15% or 16.5%
in the case of rendering of services to unregistered persons?
Ans.
The provisions of section 3(1A) regarding further tax shall not
apply in case of services provided or rendered by clubs as these are
normally received by the direct consumers.
(iv)
It is not clear whether the turnover tax under section 3A is
applicable to the service providers as they are more akin to retailers.
Section 3(2) of the Provincial Ordinance, 2000 state that the sales tax
should be charged and levied on services in the same manner and at the
same time as if it were sales tax leviable under sections 3, 3A or 3AA as
the case may be.
Ans.
Provisions of section 3A or section 3AA of the Sales Tax Act,
1990 do not apply on clubs as they are neither manufacturers nor
retailers; they are service providers.
(v)
It is not clear whether the debit and credit notes as provided in
section 9 of the Sales Tax Act, 1990 would be applicable (billing to
members can be subject to downward revision)?
Ans.
The provisions of section 9 of the Sales Tax Act, 1990 as
restricted by the Debit and Credit Note and Destruction of Goods Rules,
1996 are applicable to clubs.