Sales Tax Instructions

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Sales Tax Instructions, 2009
June, 1994. Fixed tax rates for small business concerns with annual turnover not
exceeding Rs. 500,000 (five lakh) and presently operating under fixed tax
schemes will remain the same as per respective Notifications on 8 th June, 1994.
However, these rates are on the lower side and are creating unhealthy
competition for the big units in organized sector. These units will provisionally
pay tax at the existing fixed rates which will be enhanced by the Board in
consultation with the Associations and the schemes will be finalized before the
end of August, 1994. Details of new arrangements for small units are available in
new SRO 566(I)/94 and SRO 567(I)/94, dated 9 th June, 1994. This may be
mentioned that supplies of unprocessed grey fabrics have been exempted from
sales tax where the same were earlier chargeable to sales tax on loom basis.
(b) All production units which are presently paying tax capacity/ fixed tax
base and whose annual turnover is above the threshold of Rs. 5 lakh will pay
ad val. tax on actual sales from Ist July, 1994.
5. LEVY OF SALES TAX AT THE RETAIL PRICE OF 47 TYPES
OF LOCALLY PRODUCED GOODS.- Sales tax on the basis of retail price has been
levied on 19 items. In addition SRO 692(I)/92, dated 22 nd July, 1992 has been amended
to abolish 2% fixed tax on all the 28 categories of locally manufactured items mentioned
therein which have now been subjected to 15% sales tax at the retail price. It is clarified
that the 2% fixed tax on 28 types of imported items levied vide the aforesaid SRO
692(I)/92, dated 22 nd July, 1992 will remain unchanged. Details are given in the SROs
which are enclosed for ready reference.
6. CAPPING OF AREA EXEMPTION FOR NWFP AND
BALOCHISTAN.- It has been proposed that the area exemption facility presently
available to the units in NWFP and the Balochistan (except Hub Area) vide SRO
529(I)/88, dated 26 th June, 1988 and SRO 580(I)/91, and 27 th June, 1991 be capped.
While the already operating factories may continue to enjoy exemption facility which
have not opened L.C. for machinery or have not firmed up financial arrangements by 30 th
June, 1994, (Details have been provided in new SRO 561(I)/94, dated 9 th June, 1994).
7. LEGAL AND PROCEDURAL AMENDMENTS IN THE SALES TAX
ACT, 1990.- The following proposed amendments in the Sales Tax Act, 1990 will take
effect when these are approved by the Parliament and Finance Bill, 1994 is passed.
(1) A new clause (d) in sub-section (9) and also a new proviso to subsection
(31) of section 2 of the Sales Tax Act, 1990, has been added so as to
provide respectively:-
(i)
(ii)
input tax credit to the person who purchases goods from a
wholesaler not liable to sales tax.
That where value at which a supply is made is higher than the
value fixed by the Central Board of Revenue, the value of goods
shall be the value at which the supply is made.