Home » News » Finance » New bank guarantee form issued for claiming sales tax refund

New bank guarantee form issued for claiming sales tax refund

ISLAMABAD (February 28 2003) : The Central Board of Revenue (CBR) has issued a new form of 'bank guarantee to be filled by the commercial exporters for claiming sales tax refund on submission of bank guarantee.

The newly devised procedure of 'bank guarantee' is specifically for the exporters, who intend to claim refund before the issuance of Bank Credit Advice (BCA) to confirm remittance of sales proceeds, from exported goods.

The CBR has issued Sales Tax General Order (STGO 1/2003) here Thursday to notify the newly drafted bank guarantee form.

The CBR said the refund of sales tax was regulated by Notification No 575 (I)/2002 of August 31, 2002 drafted by a committee headed by the Export Promotion Bureau (EPB) chairman.

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and other exporters associations had proposed some amendments, which were made by SRO 02 (I)/2003 of January 1, 2003.

However, the commercial exporters placed another demand to allow refund under rescinded SRO 417 (I)/2000 till June 30, 2003.

The FPCCI and All Pakistan Cloth Exporters Association (Apcea) further suggested that commercial exporters be allowed refund of sales tax on submission of bank guarantee instead of Bank Credit Advice (BCA).

The authorities have again amended SRO 575 (I)/2002 through issuance of another SRO 203 (I)/2003 of February 27, 2003.

Now the commercial exporters were entitled to sales tax refund under the provisions of rescinded SRO 417 (I)/2000 for the refund claims filed till June 30, 2003.

Moreover, the department would sanction the admissible amount of refund claim to the commercial exporters on submission of bank guarantee in lieu of Bank Credit Advice (BCA), for which Sales Tax General Order No 01/2003 dated 27.02.2003 has also been issued.

The text of the STGO 1/2003 issued here on Thursday.

Subject: Format of bank guarantee to be furnished by commercial exporters in terms of SRO (I)/2003 dated 27.02.2003.

“The Central Board of Revenue is pleased to prescribe the following format of bank guarantee to be furnished by commercial exporters in terms of SRO. (I)/2003 dated 27.02.2003, if they want to claim Sales Tax Refunds before the issuance of Bank Credit Advice (BCA) confirming remittance of sales proceeds of exported goods.

FORMAT

BANK GUARANTEE

“Whereas the Collector of Sales Tax, has consented to release/sanction refund claim pertaining to the period ________, filed by ____(Commercial Exporter)__ on ___________, in respect of shipping bill (s) No ______________ dated ________, pending production of Bank Credit Advice (BCA) from the country to which goods have been exported or from the letter of credit opening bank and verification of payment of sales tax by suppliers, on furnishing a Bank Guarantee equivalent to the amount of input sales tax, Rs ( in figures) [Rupees (in words) ] involved against the purchases used in the manufacture of goods exported vide the said shipping bill (s).

Whereas we the _(Bank) ____ do hereby undertake to make payment of aforementioned amount of input sales tax, along with additional tax @ 2% per month and penalty @ 3% on demand to the Collector of Sales Tax, or any Officer authorised by him in this regard without objection or reservation or any reference to the above named commercial exporter, within seven days of the receipt of the demand notice.

In case we the ___ _(Bank) __ __ fail to make the payment within seven days of the said demand, the ___ _(Bank) ____ shall be liable to pay a compensation @ 20% per annum for the period from the expiry of the seventh day to the date when the actual payment is made to the Collector of Sales Tax. The Guarantee shall remain valid till payment of whole of the amount demanded along with compensation as prescribed above or receipt of release orders issued by the Collector of Sales Tax, whichever is earlier.

We the ___ _(Bank) _ ___ bind ourselves to pay, unconditionally, the amount of sales tax etc mentioned above, in case no release order is received from Collector of Sales Tax, ________, before the expiry of this Bank Guarantee on ________________.

For and on behalf of the __________(Commercial Exporter)__ __

Witnesses:

Name____________________ Name________________________

NIC No __________________ NIC No ______________________

Address __________________ Address ______________________

Signature_________________ Signature _____________________

Leave a Reply