Bearing value date of June 30, 2016: SBP asks banks to accept ST refund cheques

The State Bank of Pakistan (SBP) has asked banks to accept sales tax refund cheques bearing value date of June 30, 2016. In order to promote exports, the finance minister in his budget speech had announced that all pending sales tax refunds till April 30, 2016, RPOs of which have been approved, will be paid by August 31, 2016. In compliance with the announcement, the Federal Board of Revenue (FBR) is issuing sales tax refunds to exporters. These refunds, amounting to Rs 17.965 billion, are being paid through 4,725 cheques.
All these cheques bear date of June 30, 2016 and printed with the validity period of three months after the months of issuance, ie, up to September 30, 2016. The value-date for the amount payable under the said cheques is June 30, 2016. Therefore, the FBR has asked the State Bank and commercial banks that these refund cheques should be duly accepted and honoured.
According to SBP BPRD Circular Letter No 27 of 2016, issued Wednesday, the FBR has requested banks to accept and honour the sales tax refund cheques bearing value date of 30th June 2016 and printed with validity period of three months up to 30th September 2016.
Accordingly, the SBP has advised all banks to immediately communicate the aforesaid instructions to their branches for necessary compliance and accept the cheques. The Ministry of Finance has also said that the timings of payment of refunds are exclusively determined by the FBR and so is the validity period of these cheques.