Experts say SRO 98(I) causing serious calculation problems

The SRO 98(I)/2013 of the Federal Board of Revenue (FBR) has created serious calculation problem in electronic filing of sales tax returns while incorporating figures of sales tax withheld under the said notification. According to tax experts here on Monday, the scope of sales tax withholding was extended vide recently issued notification 98(I)/2013 and by virtue of amendment companies and exporters were declared as sales tax withholding agent.
The sales tax withheld amount by customers is reclaimable, the system deducts the same from minimum sales tax liability of 10 percent and any further payment is required to be paid, however in case of withheld credit amount is higher than payable 10 percent amount the same is not got adjusted and added tax carried forward amount due to some systemic calculation mistake. The issue has been taken up with concerned tax authorities but no outcome is yet received.
Exporters have also criticised non-adjustment of their input tax credit, with sales tax withholding done by them. Saleem Parekh, ex-chairman of Pakistan Hosiery Manufacturers Association (PHMA) has informed that sales tax withholding amount is required to be paid in cash, even in case where excess input tax / refund is appearing in their sale tax return.
He strongly criticised non-adjustment of input / output of sales tax withholding, the sales tax payment which we made on purchases is refundable and got refunded after long time, the payment which we collect needs to be paid immediately, does it make any sense? he questioned tax authorities. It seems that every possible efforts were made to squeeze taxpayers, generally the law provide input/output adjustment within return, the tax payment or refund is only arrived after complete adjustment of input/output, hence cash payment of sales tax withholding amount in the presence of input tax credit is unjustified and against the spirit of law and a tool to generate more refunds.
Meanwhile, sources further informed that notices for non-withholding of sales tax for the month of February were issued by the tax offices, without appreciating the fact that sales tax withholding according to law was required to be done at the time of payment and in case no withholding was done meant the payment to the customers was not made. The immediate issuances of notices were thus unnecessary and added further misery to taxpayers, they added.