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New procedure for recovery of excess sales tax refund

ISLAMABAD (December 28 2002) : Tightening laws for the exporters registered with the sales tax department, the Central Board of Revenue (CBR) has announced new procedure for the recovery of excess sales tax refund paid to exporters allegedly involved in incorrect declarations of export consignments.

The new sales tax procedure has been notified to all collectors of customs for immediate compliance as according to sales tax department, a large number of sales tax registered exporters do not correctly declare the description, quantity and weight of export consignments in the shipping bills.

Following new mechanism, the CBR has made it mandatory for the registered exporters to declare sales tax registration number along with other particulars in the shipping bills including computer printout showing exports by each sales tax registered person.

The customs would also submit the details of false declarations, if any, in the remarks' column by the 10th of the following month to collector of sales tax.

The system would ensure that the refund of sales tax has been recovered from the registered exporters or no refund claim is allowed on the basis of fake/forged shipping bills and other documents prepared for showing exports of zero-rated goods.

The sales tax department has expressed serious apprehensions over the lenient attitude of customs towards the exporters.

The custom authorities do unearth these incorrect declarations after completion of laid down examination procedure.

However, these custom officials at the ports/airports did not bother to pass on the information to the respective collector of sales tax responsible for allowing refund of sales tax on the raw material used in the production of exportable consignments.

To check the mis-declarations by the exporters, the sales tax authorities have asked the custom officials to restrict the exporters to adopt the above-mentioned procedure.

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