ISLAMABAD, July 11: The Central Board of Revenue on Monday issued new special procedures for payment of sales tax by manufacturers of biscuits and confectionery. The procedures were notified through a sales tax notification SRO694 issued on Monday by amending the Sales Tax Special Procedures Rules, 2005. The provisions of the new procedures would only apply to the manufacturers of biscuits and confectionery, who are required to pay sales tax on printed retail price of their products.
All the registered manufacturers shall, in addition to sales tax payable at the rate of 15 per cent of the value at which the goods are cleared or supplied from the factory (ex-factory price), pay sales tax on a value addition of 12 per cent in lieu of sales tax payable on the basis of printed retail price.
The new rules carried illustration for determining sales tax on these products following value addition.
While determining his tax liability, a manufacturer shall be entitled to claim input tax credit for the tax paid on account of taxable purchases or imports made by him and utilities like gas or electricity consumed for furtherance of taxable activity, against his output tax liability, subject to the conditions, limitations, and restrictions prescribed under section 7 and 8 of the act and the rules or notifications issued thereunder and subject to fulfilment of the conditions laid down under section 73 of the act.
The retail price inclusive of sales tax shall be legibly, prominently and indelibly printed or embossed by a manufacturer on each article, packet, container, package, cover or label, as the case may be.
The manufacturer, who for any reason, cannot have the retail price printed, shall declare to the collector of sales tax having jurisdiction the retail price, at which the item would be sold to the general body of consumers, along with the reasons or justification for not printing the retail price.
And every manufacturer shall maintain the records prescribed under section 22 of the act or any notification issued thereunder.
