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- 13-07-2011
BRA TEAM VISITS OICCI TO DISCUSS Balochistan SALES TAX ACT 2011
Quetta: A delegation of the Balochistan Revenue Authority (BRA), headed by Akhtar Jamil Khan,
Member, Operations, BRA, along with Mumtaz Ahmad, Member, Legal and Coordination, BRA,
visited the Overseas Investors' Chamber of Commerce & Industry (OICCI) to have a
comprehensive discussion on the recently promulgated Balochistan Sales Tax on Services Act 2011
(SSTSA). A large number of OICCI members attended the meeting. Sirajuddin Aziz, chairperson of OICCI
taxation subcommittee, and Abdul Aleem, Secretary General, OICCI, welcomed the delegation.
Shabbar Zaidi, tax specialist and Member of Revenue Advisory Council, FBR (Policy Advisory
Board), was also present to add value to the discussion. OICCI Secretary General gave a brief
presentation on the role of OICCI and shared with the delegation OICCI's approach on taxation
matters.
Mumtaz Ahmad gave a brief presentation on the SSTSA 2011 and shared that the current tax-toGDP ratio is 10.2 percent, out of which the federal ratio is 9.2 percent and provinces share one
percent of it. He said that the province was contributing around 52 percent in the total federal
revenue collection, whereas it was receiving only twenty percent of it. He said that starting from fiscal year 2011-12, Balochistan would collect sales tax on services rendered in the province at the rate of 16 percent and 19.5 percent on telecommunication services.
OICCI Members sought clarification from BRA regarding the input tax claim adjustments and
inquired whether services such as telecommunication, advertisement, insurance and freight
forwarding would be subject to double taxation since federal excise duty (FED) is already
applicable on them. Another major cause of concern of OICCI was the withholding of Sales Tax
from vendors/service providers who are non-resident of Balochistan. They also wanted clarification on
the consequences of doing business with a non-registered vendor/service provider. BRA
satisfactorily clarified these matters which in essence appeared reasonable.
Regarding the services rendered or acquired from a blacklisted vendor, BRA said that the issue
has been resolved with the FBR and an amendment would soon be issued by the federal
authorities. BRA clarified that based on suggestions and inputs from stakeholders like OICCI, the
Balochistan Sales Tax Act will be improved and made user-friendly for affected parties. Jamil shared
that BRA has already made a Technical Advisory Committee to resolve issues as they surface
during implementation phase. BRA representatives also gave a practical demonstration of their website which has a swift
enrollment process and is linked with the FBR website.
- 06-07-2011
FBR withdraws FED to the Sales Tax on services receivable by the provinces to avoid double taxation.
The Services rendered by registered persons who were previously subject to Federal Excise Duty (being
collected in Sales Tax mode) have now been subject to Sales Tax by the Provinces through their legislation
with effect from 1st July, 2011. The Federal Board of Revenue through a notification has withdrawn Federal
Excise Duty on such services (Table-II of First Schedule to the Federal Excise Act, 2005) with effect from
the same date i.e. 1st July, 2011 in order to avoid double taxation.
However, the registered persons providing such services will continue to charge Tax/Duty and file Sales
Tax Returns as before with certain amendments being worked out in Federal Board of Revenue and the
registered persons shall face no difficulty for switching from Federal Excise Duty to the Sales Tax on
Services receivable by the Provinces.
- 01-07-2011
"Notification"
S.R.B.Leg (1)/2011. In exercise of the powers conferred by sub section (1) of section 10 of the Balochistan Sales Tax on Services Act 2011, with the approval of the Government of Balochistan, the Balochistan Revenue Authority is pleased to exempt whole of sales tax on services leviable on the services mentioned in Column (2) of the table below and falling in the heading numbers in (3) therof the namely. Click here to read the Notification.
- 30-06-2011
"Balochistan Sales Tax on Services Rules 2011"
No:Legal/231/2011:In exercise of the powers conferred by section 72 read with section 13 of the Balochistan Sales Tax on Services Act, 2011, with the approval of Government of Balochistan, the Balochistan Revenue Authority is pleased to make the following rules. Click here to read the Rules.
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