ISLAMABAD: Federal Board of Revenue (FBR) will formulate a new tax policy to facilitate jewellers and traders in consultation with all jewellers associations and Pakistan Traders Alliance during the current week.
According to sources, the FBR already took measures to facilitate business community by stocktaking different sectors on the basis of self-assessment without physical intervention of tax officials. The FBR has allowed all big retailers and distributors to operate under their business registration numbers without payment of any fee. In order to simplify the business registration process, the FBR will issue a mobile app in English and Urdu languages by July 19, 2019.
For traders, the FBR will introduce a very simplified fixed tax scheme.
According to the details of the facilitative measures taken by the FBR, no officer of the FBR would be authorised to conduct inspection for the purpose of stocktaking. Stocktaking of the business would be done on the basis of self-assessment. If there is a need for inspection, the stocktaking would be done with the consent of the relevant association of the business community.
The FBR said that various amendments have been made in the sales tax through Finance Act, 2019 and major sectors have to charge sales tax at standard rate of sales tax @ 17% w.e.f. 01.07.2019 on supplies. In this regard, the Board has already issued instructions for obtaining declaration of stocks as on 30.06.2019 from taxpayers to avoid any lapse.
The FBR said that the government has already reduced withholding tax on transporters from 4 percent to 3 percent under section (1) of section 153(i) of the Finance Act 2019.
The FBR has already barred the field formations from conducting raids at the business premises and a directive was issued to the field formations. On the proposal of the FBR, the government has reduced additional customs duty on the import of edible oil from 7 to 2 percent. The FBR has also allowed clearance of imported Third Schedule items without printing of retail price or affixing stickers for which goods declaration are filed by the importers up to July 31, 2019.
According to the FBR, the Board’s vide letter No. 1/2-STB/2019/87779-R, dated 4.7.2019, had directed that imported Third Schedule items be allowed clearance after affixation of stickers printed with retail price till July 31, 2019.
The Board has received several representations that the requirement of printing retail price on imported Third Schedule items has been introduced through the Finance Act, 2019 and the importers did not have sufficient notice of the change, therefore, a large number of consignments of such items are arriving without printed retail price, and that that de-stuffing of containers to affix stickers in the aforesaid manner is not practical and the same would cause blockage of imports and congestion at the ports.
Accordingly, in order to resolve the issue the Board has allowed clearance of imported Third Schedule items without printing of retail price or affixing stickers for which goods declaration are filed by 31st July, 2019 subject to the condition that the importer declares retail price for each of the imported items in terms of section 2(27) of the Sales Tax Act, 1990, and that the goods are assessed for sales tax on such declared retail price, the FBR added.
The FBR clarified that no sales tax has been imposed on wheat flour in any form i.e. aata, maida or suji. It is further elaborated that serial number 19 of the Table-1 of Sixth Schedule to the Sales Tax Act, 1990, has been amended through the Finance Act, 2019, to withdraw exemption on those products of milling industry, other than wheat and meslin flour, which are sold in retail packing bearing brand name or a trademark.
This amendment does not affect the exemption already available to wheat flour and it remains exempted from sales tax under this serial, even if it is packed or sold under a brand name.
Further, through the Finance Act, 2019, a new serial number 59 was added to the Table-1 of Eighth Schedule to the Act, whereby the sales tax at reduced rate of 10% has been imposed on the products of milling industry except wheat and meslin flour if sold in retail packing under a brand name or trademark. This serial number also excludes wheat flour and therefore it if not applicable to wheat flour, the FBR added.
The FBR has taken the above mentioned measures to facilitate traders after having meeting with different trade bodies and chambers.