It is indeed a great dilemma that the exporters are not getting Input Tax Refund against the invoices issued by Service Providers since the inception of Sindh Board of Revenue. Over and above this, the amount of input tax so claimed in the exporters' Sales Tax Return are regularly shown as "deferred" with the objection for non filing of sales tax return by them.
This was stated by Saleem Parekh, Central Chairman, All Pakistan Textile Processing Mills Association and Former Central Chairman, Pakistan Hosiery Manufacturers and Exporters Association.
He further said that the Sales Tax invoices of the service providers in Sindh are not being verified by the FBR and earnestly felt that for verification of the output tax, there must be proper system for immediate electronic verification of output tax by the FBR. It is imperative, he stressed, that the FBR must have a proper integrated system connected with the external provincial sales tax collecting authorities to avoid input/output verification problems because a huge amount of input tax of the exporters is held up at FBR due to non-verification through the electronic system.
It is pertinent to note, he said, that Service Providers are regularly filing their sales tax returns with SRB as required under Sindh Revenue Board, presuming the fact that there is no access of electronic verification between SRB and FBR the same remain non verified and thus taxpayers bona-fide amount of refund claims were got stuck without any fault at their part.
He said that under Section 10 of the Sales Tax Act., 1990, the refund claim submitted by the claimant is either to paid or rejected within 45 days but the irony is that the refund processing office neither allows refund against input tax nor explains the reason and their stance for holding back "Input Tax against service charges".
He said that there is no denying the fact that the service sectors are filing their Sales Tax return well in time with the Sindh Revenue Board. It is imperative that the FBR is equipped for proper access to the SRB Database which will speed up the verification process of Sales Tax returns filed by taxpayers in Sindh and resultantly facilitate the payment of input refunds against the invoices issued by Service Providers in Sindh to the exporters.-PR
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