Sales Tax Instructions

Sales Tax Instructions, 2009
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C.NO. 3(72)STP/97 (Pt-2) DATED 2 ND AUGUST, 2006
SUBJECT:
SALES TAX ON SALE OR AUCTION OF USED AND
UNSERVICEABLE VEHICLES
I am directed to refer to the subject noted above and to say that the special
procedure for collection and payment of sales tax on vehicles a in chapter XVII of the
repealed Sales tax Special Procedures Rules 2005, stipulated that sales tax on sale of old,
used and second-hand vehicles will be deposited by taking ten percent of the declared
sale / purchase price as assessable value. Now, the above said rules have been repealed
by the Sales Tax Special Procedures Rules, 2006, as issued vide notification No. SRO
560(I)/2006 dated 05.06.2006. The new rules do not stipulate production of evidence of
payment of sales tax on old, used and second-hand vehicles at the time of registration.
Car dealers are nonetheless required or service charges on, inter alia, purchase and sale
of vehicles, in their monthly returns and discharge their liabilities, if any.
2. It is further to reiterate that serial no. 6 of Table 2 of the Sixth Schedule
to the Sales Tax Act, 1990, provides sales tax exemption on supply or disposal of fixed
assets against which input tax adjustment is not available under a notification issued in
terms of clause (b) of subsection (1) of section 78 of the Sales Tax Act, 1990. The
notification No SRO 490(I)/2004 dated 12.6.2006 issued under the aforesaid provisions
bars adjustment of input tax on vehicles falling in chapter 87 of the First Schedule to the
Customs Act. Therefore, the sales tax on such vehicles, if sold or auctioned otherwise
than as stock-in-trade, will not be payable.
3. This clarification, however, does not apply to the vehicles in respect of
which duty / taxes have not been paid at the original stage. Such vehicles shall remain
chargeable to sales tax at the time of sale / disposal thereof.
4. The Collectors are requested to convey these instructions to all
government / semi-government departments and autonomous bodies in their respective
jurisdictions and other agencies responsible for ensuring payment of sales tax in such
cases.
[Issued by the Government of Pakistan, Revenue Division, C. B. R. (Sales Tax & Federal
Excise Wing), Islamabad, under the signature of Mr.Abdul Hameed Memon, Secretary (ST&FE-
L&P), addressed to the Collector, Sales Tax & Federal Excise, Rawalpindi/ Faisalabad/
Peshawar/ Gujranwala/ Lahore/ (Hqrs.)/ (Audit)/ (Enforcement), Sales Tax House, Karachi, the
Collector, Customs, ST & FE, Multan/ Hyderabad/ Quetta and the Collector, Large Taxpayers
Unit, Karachi (Audit)/ (Enforcement), Lahore. Copy to the Secretary (S&M), CBR, Islamabad.]
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C. No. 1(17)CEB/96 DATED 2 ND AUGUST, 2006
SUBJECT:
REFUND CLAIMS FILED BY PAYPHONE COMPANIES.