S.R.O. 603(I)/2009, Islamabad, the 25th June, 2009

SROS: S.R.O. 603(I)/2009, Islamabad, the 25th June, 2009 AMENDMENTS IN THE SALES TAX SPECIAL PROCEDURE(WITHHOLDING) RULES, 2007. S.R.O. 603(I)/2009, Islamabad, the 25th June, 2009:- In exercise of the powers conferred by sub-sections(6) and(7) of section 3 and sub-section(4) of section 7 of the Sales Tax Act, 1990, read with section 71 thereof, the Federal Government is pleased to direct that the following further amendments shall be made in the Sales Tax Special Procedure(Withholding) Rules, 2007, namely:-- In the aforesaid Rules, (1) in the preamble, after the word and figure section 3, the words, brackets and figures and sub-section(4) of section 7 shall be inserted; (2) in rule 1, for sub-rule(2), the following shall be substituted, namely:-- (2) They shall apply to taxable goods and services as are supplied to following persons, hereby specified as withholding agents, for the purpose of deduction and deposit of sales tax, namely:-- (a) federal and provincial government departments; (b) autonomous bodies; (c) public sector organizations; (d) taxpayers as fall in the jurisdiction of Large Taxpayers Units for the purpose of sales tax, federal excise duty or income tax; and (e) recipients of service of advertisement, who are registered for sales tax. Explanation. withholding agent includes the accounting office which is responsible for making payment against the purchases made by a government department.; (3) in rule 2,-- (a) for sub-rules(2) and(3), the following shall be substituted, namely:- (2) A withholding agent, other than a person in the jurisdiction of Large Taxpayers Unit and a recipient of advertisement services, shall deduct an amount equal to one fifth of the total sales tax shown in the sales tax invoice issued by a registered person and make payment of the balance amount to him as per illustration given below,-- ILLUSTRATION: Value of taxable supplies excluding sales Rs. 1000 tax Sales tax chargeable @ 16% Rs. 160 Sales tax to be deducted by the Rs. 32(i.e. Rs. 160 5) withholding agent Sales tax payable by the withholding Rs. 128 (i.e. Rs. 160 - agent to the supplier Rs. 32) Balance amount payable to the supplier Rs. 1128 (i.e. Rs. 1000 by the…