KARACHI, Dec 5: The auto assemblers have taken strong notice of a report based on a circular issued by the Karachi Motorcycle Dealers (KMD) which states that Sindh Motor Registration Authority has agreed to accept manufacturers’ invoice for registration of motorcycles.

The KMD claims that the motorcycle dealers are working on commission and therefore are not required to be registered with the Sales Tax Department. The Pakistan Automotive Manufacturers’ Association (PAMA) in a communication to the Sindh government has drawn attention towards the SRO issued on June 5, 2006, which according to the association clearly stipulates registration of manufacturer, importer and dealer of vehicle with the Sales Tax Department.

“Anybody who is involved in selling vehicles, other than manufacturers, to the customers is a vehicles dealer,” contends PAMA in its letter to establish that the commission agent is also a dealer and has to be registered with the sales tax department.

The PAMA says that even if a vehicle is invoiced by the manufacturer directly to the customer, the dealer has to issue a delivery advice-cum-invoice indicating the amount of sales tax, if any, charged thereon by the dealer over and above the price shown in the invoice issued by the manufacturers. A dealer is required to issue sales tax of zero value if he is selling vehicle at the price indicated in the invoice issued by the manufacturer.

In a circular last month, the KMD advised all its dealer members not to give the receipt or put stamp of their showrooms on the documents to be given to Sindh Excise and Taxation Department. The sales receipt should be given only to the buyer of motorcycles.