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Minimum benchmark value of bill of entry reduced

ISLAMABAD (August 21 2004): The Central Board of Revenue (CBR) has substantially reduced the minimum benchmark value of bill of entry from Rs 2,500 to Rs 2,000 for levying sales tax on services rendered by the customs agents.

Thus, customs agents will have to pay minimum sales tax of Rs 300 per bill of entry as compared to Rs 375 charged on the basis of enhanced benchmark.

The CBR has also given exemption from sales tax audit to those customs agents who deposit sales tax in accordance with the minimum benchmark value per document.

In this regard, the authorities have withdrawn the condition that 10 percent of the customs agents who deposit sales tax in accordance with the minimum benchmark level per document would be selected for audit.

The CBR has revised “special procedure for persons providing or rendering taxable services 2004” through an SRO 710 (I)/2004 issued here on Friday.

Official sources told Business Recorder that the tax authorities and customs agents convened a number of meetings since the announcement of Budget 2004-05. They requested the CBR to amend procedure for collection of sales tax on the services provided by customs agents. The CBR has accepted their proposal by reducing minimum benchmark, while giving audit exemption to agents who opt to pay sales tax on the basis of minimum benchmarks.

According to the notification, the minimum value of taxable service for each bill of entry has been brought down from Rs 2,500 to Rs 2,000. However, the minimum value of taxable services provided by customs agents has not been changed. These documents include ex-bond bill of entry or goods declaration filed; shipping bill or bill of export or Pakistan goods declaration for export filed; rebate claims filed; bill of entry or Pakistan goods declaration filed at airport (AFU), including baggage declaration and transit or transshipment permit.

According to the notification, there will be no routine audit of customs agents who deposit sales tax as per minimum benchmark value per document.

Following is the text of the notification issued here on Friday: SRO 710 (I)/2004.- In exercise of the powers conferred by Section 71 of the Sales Tax Act, 1990, read with clause (9) of Section 2, sections 3, 3AA and 4, sub-section (2) of Section 6, Section 7A, clause (b) of sub-section (1) of Section 8, clause (a) of sub-section (2) of Section 13, sections 26AA and 34A and the first and second proviso to Section 45 thereof, the Federal Government is pleased to direct that the following further amendment shall be made in the Sales Tax Special Procedures Rules, 2004, namely:-

In the aforesaid Rules, in rule 83.-

(a) in sub-rule (1), in the TABLE, against S. No. 1, for the figure “2500” the figure “2000” shall be substituted; and

(b) in sub-rule (2) for clause (b) the following shall be substituted, namely:-

“(b) There shall be no routine audit of the Custom-house agents who deposit sales tax in accordance with the minimum benchmark value per document”.

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