ISLAMABAD (December 04 2003): The distributors, commission agents, wholesalers and dealers are liable to pay sales tax on supply of taxable goods – manufactured in Federally Administered Tribal Areas (Fata) and Provisional Administered Tribal Areas (Pata) – to the tariff areas, says an order issued here on Wednesday.
Therefore, all distributors, commission agents, wholesalers and dealers receiving taxable goods manufactured in non-tariff areas are required to get registered with the sales tax department.
The CBR has directed all collectors of sales tax to implement the clarification forthwith.
Sources said that all such distributors/dealers and other businessmen handling goods, like ghee/cooking oil, cosmetics, cigarettes etc, manufactured in non-tariff areas, are required to be registered under Sales Tax Act and pay sales tax on the supply of taxable goods from non-tariff areas into tariff areas.
According to the CBR directive, since Sales Tax Act, 1990, has not been extended to Fata and Pata yet, a question had arisen whether sales tax was leviable on goods manufactured in Fata/Pata (non-tariff areas) and subsequently brought/supplied into tariff areas.
The CBR examined the matter under the relevant law and issued the ruling that wholesalers, dealers and distributors making taxable supplies are required to be registered under the Sales Tax Act, 1990.
Accordingly, any distributor, commission agent, wholesaler or dealer, who receives taxable goods manufactured in non-tariff areas, is also required to be registered under Sales Tax Act, 1990.
Hence, any subsequent supply of taxable goods manufactured in non-tariff areas by this category of registered persons will attract levy and payment of sales tax under the provisions of Sales Tax Act, 1990.