Bismillah Ir Rahman Ir

Raheem
 SALES TAX

Presented by:
FARAZ FAZAL SHIEKH ADVOCATE.
L.L.B.,
MBA (MARKETING),
MBA (TAXATION),
TRADE MARK AGENT,
Sr. V. PRESIDENT TAX BAR ASSOCIATION,
SECRETARY GENERAL TAX BAR (06-07), (12-13) &
(14-15),
MBA (FINANCE),
FACULTY MEMBER NAB,
INCOME TAX PRACTITIONER,
MEMBER (ADRC) FBR,
EXECUTIVE MEMBER TAX BAR (6 TIMES).
Message of the day

”Do all things

with LOVE"
 TABLE OF CONTENTS

1. Sales Tax Act, 1990.

2. Sales Tax withholding.

 SALES TAX ACT, 1990

A Federal levy,

History: - 1951, 1990, 1999.

Previously only on Goods and after 18th

amendment its scope is wider to
services in the capital territory.

While Provinces are collecting Sales Tax

on Services in the Provinces.
Sec 3 DEFINITIONS.

 Retailer,
 Cottage industry,
 Appellant Tribunal,
 Goods,
 Services,
 Tax,
 Taxable and Non Taxable Activity,
 Exemptions,
 Default Surcharge,
 Value of supply,
 Tax fraction,
 Tax Fraud,
 Time of Supply,
 Tax Period.
Sec 2 ACTIVE TAXPAYER.

“active taxpayer” means a registered person who does not fall in

any of the following categories, namely:-

who is blacklisted or whose registration is suspended or is

blocked in terms of section 21;

who fails to file the return under section 26 by the due date for
two consecutive tax periods;

who fails to file an Income Tax return under section 114 or

statement under section 115, of the Income Tax Ordinance,
2001(XLlX of 2001), by the due date; and who fails to file two
consecutive monthly or an annual withholding tax statement
under section 165 of the Income Tax Ordinance, 2001;
Sec 3 SCOPE & PAYMENT OF TAX.

3(1)

• @ 17 %, +-
• on taxable goods & Services.
• Goods imported in to Pakistan.

 Liability of payment of Sales Tax is of the person making the

Supply.

 In case of Imported goods, the person who is importing the

goods.
Sec 3 FURTHER TAX

3(1)(A)

• Goods supplied to the unregistered persons

• @ 2 %,

 Exclusions: -
• Retailers,
• 3rd Schedule items.
• Etc.
 MULTI TAXES / COMPLEXICITIES.

• Sales Tax,

• Further Tax,

• Extra Tax.

• Retail Tax.

• Additional Sales Tax.

Sec 7 DETERMINATION OF TAX
LIABILITY.

PAYMENT OF SALES TAX.

 Out Put Tax.

 In Put Tax.
Sec 7 OUT PUT TAX

Levied on the sales (GOODS OUT).

Sec 7 IN PUT TAX

Levied on the Purchase (GOODS IN).

Sec 11 ASSESSMENT

 Invoke for short levy or non levy of tax.

 Any other evasion.

 Show cause notice.

 Order

 Recoveries.

 Prosecution / Arrest.

 Attachments etc.
 Sec 22 RECORDS
• Purchase Invoices (Input Tax).
• Sales Invoices (Output Tax).
• Purchase Registers.
• Sales Registers.
• Bills, Utility etc.
• Other Registers.
• Bank Statements.
• Sales Tax Returns.
• Income Tax Returns.
• Quotations.
• Payments Through Cross Cheqeus.
• GDs,
• Financials (profit & loss accounts),
• Physical Stock Taking,
• Any Other.
Sec 24 RETENTION OF RECORDS

• 5 Years + Current Year

Sec 26 RETURNS

• Monthly Return.

 To be furnished before 15th of each month for the

preceding month.

• Special Return.

• Final Return.

• Deemed Return etc

 APPEALS ETC

 Appeal to Commissioner Inland Revenue.

 Appeal to Appellate Tribunal Inland Revenue.

 Reference to High Court.

 Reference to Supreme Court.

 COMPLAINTS

 Complaint to Federal Tax Ombudsman.

 Presentation before the President of Pakistan.

 REVIEW & TAX SETELLMENTS

 Review by the Chief Commissioner.

 Alternate Dispute Resolution Committees.

 Presentation before the Chairman FBR.

 SCHEDULES

• THIRD SCHEDULE.
• Payment of Taxes on retail price.

• FIFTH SCHEDULE.
• Zero Rated Goods.

• SIXTH SCHEDULE.
• Exempt Goods.
WITHHOLDING
Of
SALES TAX
 WITHHOLDINGS

SALES TAX SPECIAL PROCEDURE (WITHOLDING)

RULES, 2007

• 1/10th of the Sales tax Amount.

• Deducted and deposited by the withholding agent.

 WITHHOLDINGS

SALES TAX SPECIAL PROCEDURE (WITHOLDING)

RULES, 2007

• Exclusions: -
• Electricity,
• Gas,
• Petroleum,
• Telecommunication,
• Third schedule goods.
• Imported goods,
• Active Taxpayers.
Q&A Session
JAZAK ALLAH

Email: Faraz_Law@hotmail.com