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Revenue Board redrafts Sales Tax Refund Rules

ISLAMABAD (October 14 2003): In a major move to facilitate the business community, the Central Board of Revenue (CBR) has redrafted 'Sales Tax Refund Rules' for streamlining the existing refund procedure.

Official sources told Business Recorder here on Monday that the new draft of the refund rules would be discussed in the coming 'collectors conference' in Lahore.

All collectors of sales tax would give their viewpoint on the amended rules, keeping in view the recommendations floated by tax consultant Maxwell Stamps.

In this connection, Mukkarm Jah Ansari, Secretary, Starr, Lahore, would give a presentation on the Starr program/proposed rules, while tax collectors would submit the updated figures of sales tax refund paid to the exporters.

Sources said that the CBR would notify the amended rules in consultation with all stakeholders.

The consultant has proposed to the CBR to establish 'Red' and 'Yellow' channels for proper identification of 'high' and 'medium' risk exporters under tax reform plan.

Under the suggestion, the 'Red Channel' would be considered as high risk, liable to full examination and audit, whereas the 'Yellow Channel' would deal with medium risk exporters.

The CBR has already compiled a comprehensive database on exporters for speedy issuance of sales tax refund under 'Green Channel' system.

The CBR is also considering to make comprehensive changes in the Starr refund automation system to withdraw provision of ruling pertaining to issuance of refund.

At present, the sales tax officials are empowered to issue ruling in cases where there is difference between the documents and data maintained with the Starr.

The Starr programme would also deal with the input tax adjustment availed by the local businessmen for speedy payment of refund to the domestic industry.

The categorisation of exporters as 'Red', 'Yellow' and 'Green', based on risk assessment, will render almost superfluous need for the gold and silver categories, sources said, adding that the exporters operating under the green channel can promptly get sales tax refund without going through lengthy procedure, the consultant added.

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