KARACHI: The Federal Board of Revenue (FBR) has advised all the Customs Collectorates as well as Large Taxpayers Units (LTUs) and Regional Tax Offices (RTOs) to ensure that sales tax is charged at revised rates on import and supply of the goods specified in SRO 1125(I)/2011.
According to instructions issued by the board, analysis of local supplies made under SRO 1125(1)/2011 reveals that most of the supplies was being made at the lowest rate i.e. 2.0 percent, resulting in loss of revenue.
While keeping in view the interests of exports, the lowest rate in the SRO has been revised to 3.0 percent. However, to facilitate persons engaged in the five export-oriented sectors covered by the SRO, the rate of value addition tax on imports of the inputs specified in SRO has been reduced to 1.0 percent. To reduce the complexity of the SRO, many of the conditions have been transposed to tabular form without changing the original scheme of the SRO.
Further, the local suppliers of items covered under SRO have been allowed to claim refund on monthly basis instead of being required to carry forward input tax for 12 months by amending rule 33 and 34 of the Sales Tax Rules, 2006.
Customs Collectorates and LTUs/RTOs are advised to ensure that sales tax is charged at revised rates on import and supply of the specified goods.