Minimum value-addition for some retailers cut

ISLAMABAD (October 19 2004): The Central Board of Revenue (CBR) has substantially reduced 'minimum value-addition' for retailers of motorcycles, rubber tyres, electronic goods for domestic use, mild steel products (steel bars) and flat rolled steel products from 10 percent to 3 percent and 4 percent for the payment of sales tax.

The minimum value-addition for motorcycle retailers will be 4 percent; rubber tyre retailers 3 percent; retailers of electronic goods for domestic use (locally made) 3 percent, mild steel products ie steel bars Rs 600 per ton (PMT) and flat rolled products of (Ch 72 incl tin free steel) will be 3 percent.

The revised minimum value-addition for these sectors would be applicable from July 1, 2004.

The CBR has amended Retail Tax Rules (SRO.484(I)/2004) through an SRO issued here on Monday.

In this regard, the CBR has clarified to the business community that the column 9B of the Retail Tax Return cum Payment Challan indicating 10 percent value-addition, may be considered as revised according to new benchmarks of value-addition for the retail sector.

The CBR has also announced that all motorcycle retailers, rubber tyre retailers, electronic goods for domestic use, mild steel products (steel bars) and flat rolled products paying sales tax on the basis of revised value-addition would be exempted from audit.

Official sources told Business Recorder that CBR issued a procedure on sales tax payment by retailers on the basis of value addition to provide a conducive and audit free environment, especially departmental stores to gradually harmonise their activities with the sales tax procedure.

Different retail sector including retailers of motor-cycles, rubber tyres, mild steel products, locally manufactured electronic appliances of domestic use and tin free steel had repeatedly approached the Board to reconsider the minimum value addition benchmark of 10 percent especially for these sectors as their value addition at retail stage was not more than 3-4 percent.

On the recommendation of the Federation of Chamber of Commerce and Industry and realising that the benchmark of 10 percent value-addition was not pragmatic for these sectors, the minimum benchmark for these sectors have been revised through amendment in rule 19 of the Special Procedure Rules 2004.

Officials added that CBR has fulfilled a major demand of retail sector and it is hoped that the retail sectors would have no hurdle in discharging their tax dues fairly and correctly.

The collectors of sales tax have decided to obtain lists of retailers of these goods from the manufacturers to ensure that all retailers are registered and subsequently discharge their tax dues correctly, officials added.

Related Articles

Back to top button
Stay up to date
Don't miss out on the latest industry news and articles
Stay up to date
Don't miss out on the latest industry news and articles
You are Subscribed!
Your subscriptions means a lot to us.
Don't miss out on the latest Industry news
You are Subscribed!