Sales Tax Instructions

Sales Tax Instructions, 2009
I am directed to invite your attention to the Sales Tax budgetary measures for
1993-94 as contained in Finance Bill, 1993 and SROs 491(1)/ 93,
492(1)/93 and 502(1)/93 all dated 14 th June, 1993.
2. These measures have immediate effect and should be implemented
forthwith. The legal amendments proposed in clause 7 of Finance Bill, 1993, with the
exception of change of rate of sales tax will however, have effect after the Bill is passed.
The instructions which follow are meant to highlight some important aspects of the
budget measures. It is requested that all the notifications and other documents may be
perused thoroughly for proper implementation.
3. Increase in the standard rate of sales tax from 12.5% to 15%.
Rate of sales tax has been increased from 12.5 percent to 15 percent on locally produced
goods as well as imported goods and has immediate effect.
4. Withdrawal of tax exemptions.
(a)
(b)
In order to broaden the tax base, exemption available to ten locallyproduced
goods (Annex-I) has been withdrawn. This measure has been
implemented through issuance of new notification SRO. 492(1)/93,
dated 14 th June, 1993 in suppression of SRO 505(1)/9`1, dated 30 th May,
1991.
The manufacturers engaged in the manufacture of aforesaid goods may
please be identified and action may be taken to register them under the
relevant provisions of the Sales Tax Act, 1990 immediately.
5. Certain industries to be declared as ―Non-Exempt‖ Industries.-
Seventeen industries (Annex-II) have been declared as ―non-exempt‖ industries which
means that cottage industry exemption available to these industries has been withdrawn
vide SRO 491(1)/93, dated 14 th June, 1993. The goods produced by these industries will
be subjected to sales tax at the rate of 5 percent without adjustment of input tax.
However, a manufacturer who does not fulfil the conditions laid down in SRO.
491(1)/93, dated 14 th June, 1993 shall pay sales tax at the rate of 15 per cent and claim
the tax credit. SRO 1112(1)/ 90, dated 1 st November, 1990 has also been amended vide
SRO 502(1)/93, dated 14 th June, 1993 to provide for registration of these industries.
(Annex-I)
S.No. Description.
1. Toilet Soap (34.01).
2. Photographic plates or films exposed and developed (37.05).
3. Cotton sewing thread (52.04).
4. Sewing thread of man made staple fibres, whether or not put up for retail sale
(55.08).
5. Screws, bolts and nuts of iron or steel (73.18).