Sales Tax Instructions

Sales Tax Instructions, 2009
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\No.2(1)STP/99 DATED 2 ND OCTOBER, 1999
SUBJECT:-
CLARIFICATION REGARDING REFUND OF SALES TAX ON
MATERIAL PURCHASED AGAINST TAX INVOICES AND
USED IN CONSTRUCTION OF PLANT AND MACHINERY
BUILDING/FOUNDATIONS.
I am directed to refer to your letter No.OCI.224/99 dated 12.3.1999 on the
subject cited above and to say that only a registered person making taxable supplies is
entitled to claim input adjustment/refund under section 8 and 10 read with section 14 of
the Sales Tax Act, 1990. However, the ―buyers or importers of taxable plant and
machinery who intend to make taxable supplies in due course shall be required to be
registered under this Act‖ under proviso to section 14 of the Sales Tax Act, 1990, if they
intend to claim any credit or refund of sales tax paid on the said plant and machinery.
2. Since your machinery/plants is exempt from sales tax, you shall be liable
to registration under the Sales Tax Act, 1990, as a ―manufacturer‖ only when you start
making taxable supplies. As regard sales tax on ―building materials‖, you are not entitled
to claim any input adjustment or refund of sales tax paid on the purchase of goods for
construction of building, skeletory structure etc. under SRO 578(I)/98, dated 12.6.1998
read with section 7, 8 or 10 of the Sales Tax Act, 1990.
3. For further clarification, if any, you may kindly approach the respective
Collector of Sales Tax.
[Issued by the CBR, Islamabad under the signature of Mr. Muhammad Tahir, Secretary
(STP) addressed to M/s Olympia Chemicals Limited, Lahore. Copy to all the Collectors of Sales
Tax/Mirpur (AJ&K).]
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No.1(33)/STP/93.Pt.I DATED 2 ND OCTOBER, 1999
SUBJECT:-
CLARIFICATION REGARDING REFUND OF SALES TAX ON
MATERIAL PURCHASED AGAINST TAX INVOICES AND
USED IN CONSTRUCTION OF PLANT AND MACHINERY
BUILDING/FOUNDATIONS.
I am directed to refer to your letter No.nil dated 17.3.1999 on the subject cited
above and to say that the relevant portion of section 34(1) of the Sales Tax Act, 1990
reads as under:-
―……….. he shall, in addition to the tax due, and the prescribed penalties, pay
additional tax at the rate of five percent of the tax due per month or any part
thereof‖
2. In view of the aforesaid legal provision, any part of a month (even one
day) is required to be taken as full month for the purpose of calculation of additional tax
under section 34(1) of the Sales Tax Act, 1990.
3. The delay in issuance of this is regretted.