Revenue Board and steel melters reach consensus on sales tax

ISLAMABAD (January 08 2004): The Central Board of Revenue (CBR) and steel melters reached consensus on benchmarks for levying fixed rate of sales tax on various iron/steel products in a meeting between Pakistan Steel Melters Association (PSMA), Lahore, and CBR Member Audit Pervaz Amjad here on Wednesday.

After the meeting, Mushtaq Ahmed Cheema, Secretary, PSMA, told Business Recorder that Member Audit has assured the association to take up the matter with Member Sales Tax for issuance of relevant SRO on the fixation of sales tax.

The CBR and steel melters have mutually hammered out parameters for calculation of sales tax on value-addition for iron and steel melting units.

The steel melters were pressing the authorities for the revival of fixed sales tax scheme for steel melters/re-rolling mills.

Cheema said that the benchmark for determining of production of ingot/billet would be 800 units per metric ton (PMT) to be calculated on the basis of power utilisation from monthly Wapda bills.

The benchmark for determination of production of MS products by the units will be 130 units PMT on actual production.

Similarly, Rs 280 PMT shall be payable by the melting units on production calculated as given above.

Rs 150 PMT shall be payable by the Composite Units on actual production basis in addition to Rs 280 PMT for melting.

However, no Output Sales Tax paid invoices will be issued by the melting /composite units and no Input Tax shall be claimed.

Each Melting / Composite unit will be liable to deposit net cash sales tax of Rs 280 PMT on melting and Rs 150 PMT on re-rolling as its minimum sales tax liability on value-addition irrespective of sales tax structure ie GST or fixed sales tax.

It may be recalled that a few months back CBR had directed collectors of sales tax to submit statement of monthly sales tax paid by the steel melters before and after fixing of sales tax at Rs 260 PMT and monthly sales tax paid by the steel melters after withdrawal of the scheme.

The CBR had also sought collectorates suggestions on PMT sales tax to be paid by the steel melters and extension of scheme to composite units including amount of sales tax to be fixed for re-rolling units.

Related Articles

Back to top button