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PRA seeks identification of unregistered, non-compliant businesses

PRA seeks identification of unregistered, non-compliant businesses

LAHORE: Punjab Revenue Authority (PRA) has asked the province’s civil administration to identify all unregistered and non-compliant businesses under their jurisdiction besides persuading them towards compliance of the sales tax.

PRA has also urged the administration to encourage such businesses for voluntary liquidation of arrears with effect from the date of the relevant service has been brought under tax net.

Sources said that PRA has issued a letter to all nine divisional commissioners of Punjab reminding them that according to PRA’s notification PRA/Orders 06/2012/3 dated January 10, 2014, Authority has empowered the civil administration officers to exercise powers and perform functions under the Punjab Sales Tax on Services Act, 2012 and rules made there under.

In order to ensure that these officers carryout their work systematically and effectively, PRA will not only continue issuing guidelines and instructions (preferably through general orders) but will also conduct intensive training sessions so that these officers are enabled to incrementally develop a true sense of VAT management. Till such time regular measures are taken for this purpose, the concerned officers were advised by the Authority to visit the website of PRA, download all the legal instruments relating to Punjab sales tax on services and peruse them thoroughly to understand the character and dynamics of the system and the nature and extent of their powers, functions and duties, the letter read.

The letter maintained that the Punjab sales tax on services system is a VAT-like sales taxation where under voluntary compliance is encouraged by bringing the potential taxpayers under registration net and guiding them towards honest tax compliance covering the areas like tax invoicing, record maintenance, assessment, preparation and filing of declarations and payment of tax through the computerised system.

Clarifying the principal function of the field officers, PRA letter said, they have to ensure that the taxable service-providing businesses territorially located in and confined to their jurisdictions do not remain non-compliant but register and pay Punjab sales tax as due on their taxable business activities. To begin with, efforts may be made to secure compliance from the following taxable services (excluding those already registered and complying properly) which include hotels, motels, guest houses, restaurants, caterers, marriage halls and lawns, clubs, property dealers, automobile dealers, rent-a-car services, tour operators, fashion designers, manpower recruitment agencies, security agencies, software or IT-based system development consultants and toll manufacturing services.

Advertising agents including advertisements on billboards, pole signs and sign boards; personal care services like beauty parlours and clinics, slimming centres and clinics, cosmetic and plastic surgery clinics; property developers/promoters including construction services, architects, town planners, interior decorators and contractual execution of work and furnishing supplies; and technical, scientific and engineering consultancy services also fall under the Punjab Sales Tax Act, the letter read.

PRA had requested the divisional commissioners to direct the officers concerned of their respective jurisdiction to identify all such unregistered and non-compliant businesses and persuade them towards compliance with effect from the date the relevant service has been brought under tax net. Arrears must be recovered under all circumstances. Voluntary liquidation of arrears may however, be encouraged.

It also added that a brief monthly report on the work done, performance delivered and achievements made in respect of the implementation and enforcement of Punjab sales tax in every jurisdiction is sent either electronically or otherwise to PRA headquarters by 5th of every month. In this regard, PRA will structure and automate the monthly/periodical performance reporting system in due course.