Sales Tax Instructions

Sales Tax Instructions, 2009
There are financial penalties if you do not register or if you fail to register when required.
Therefore, if you are in any doubt about whether or not you should register, please
contact your local Sales Tax office.
How do I register?
To register for sales tax, you must complete form ST1. You can get a copy of this form
from your local Sales Tax office.
But remember, when you become liable to register you must apply for registration within
30 days. There are penalties if you fail to do so.
What else must I do?
When you supply goods or taxable services you must issue a tax invoice. The law
requires an invoice to show specific details about the transaction.
You must also keep previous records that will enable you to prepare your return, and to
pay the correct amount of tax.
You must make these records available to the officers who are authorized to inspect and
audit them.
Sales Tax at the Retail Stage.
What is sales tax at retail stage?
It is the sales tax charged by registered retailers on goods sold to the general public. The
rate of tax is 15% for registered persons.
It also includes 2% tax paid by enrolled retailers on their turnover.
Is sales tax chargeable on all goods?
No. Some goods are exempt from sales tax. Here are examples of exempt goods.
• Unprocessed foodstuff.
• Most medicines.
• Computer hardware, laptops & notebooks, PCs, main
frame and peripherals.
In the Sixth Schedule to the Sales Tax Act, 1990 you can get a complete list of exempt
items or you may get it from your local sales tax office.
I am a retailer, what are my legal obligations?
All retailers with turnover upto Rs. 20 million in last 12 months must enroll and pay sales
tax @ 2% or register & pay sales tax @ 15% at the option of the retailer.