Sales Tax Instructions

Sales Tax Instructions, 2009
4. Rule 297(6) allows an exporter to
get his goods manufactured from
anywhere in Pakistan from a sales tax
registered person. In some cases,
applicant gets processes like dying,
printing etc. done by some vendors
and claim exemption of sales tax on
processing charges.
5. Whether DTRE approval can be
granted to a unit against whom a
contravention case has been
established under Customs Act , 1969
Sales Tax Act, 1990 or Central
Excises Act, 1944 especially if such
unit has proof of advance payment or
valid export contract against the
DTRE application.
6. An incident has been noticed where
the exporter applied for DTRE
approval prior to amendment vide
SRO 490(1)/2003 dated 7.6.2003. He
was accordingly not allowed import of
polyester staple fiber as it was banned
under DTRE Scheme prevailing at
that time. After the amendment
vide SRO 490(I)/2003, polyester
staple fiber becomes eligible for
import under DTRE scheme. The
exporter who was allowed DTRE
approval prior to issuance of SRO
goods for Export under DTRE scheme
is covered under the definition of
input goods. However, this facility
may be allowed only after determining
input-output ratios and for the
generators equipped with meters duly
sealed by electricity Inspectors of the
relevant province for recording the
generation of units electricity.
The processing charge shall not be
subjected to sale tax under sub-rule
(8) of rule 297 treating the same at par
with zero-rated supply. The DTRE
applicants may make tentative
declaration about such processing
charges in the DTRE application.
DSAO may also endorse sales tax
invoices issued by the registered
vendors in this regard.
The Collectorates should have
sympathetic view in respect of
applications against export contracts/
advance payments. If the export
contract is verified and advance
payment is received the DTRE should
not be withheld unless the applicant
has committed a serious fraud and
duty adjudged by a judicial or quasijudicial
forum. The term serious fraud
means deliberate or intentional
evasion of duty and taxes with the
knowledge that revenue loss is being
caused to the Government.
SRO 490(I)/2003 dated 07.06.2003
cannot be given retrospective effect
However, amendment in DTRE
approval with prospective effect can
be allowed for future export of the
balance quantity, if any. In other
words, if export contract has not been
fully covered under the old DTRE
approval, the exporter can get his
approval amended or get a
supplementary approval only to the
extent of the balance quantity of
contracted export.