Taxpayers are facing problems in adjusting sales tax paid through "Bill of Additional Duty (BOAD)" during e-filing of sales tax returns. In a letter sent to FBR Chairman Tariq Bajwa, Karachi Tax Bar Association (KTBA) said that a registered person was entitled to deduct input tax paid through the BOAD from output tax as he had Original Bill of Entry or Goods Declaration in the name that not only showed sales tax registration number but also cleared by the Customs authority.
It said that manufacturers were also facing difficulties in claiming import bill of entries wherein Federal Excise Duty (FED) in sales tax mode had been paid at the stage of import of vegetable and cooking oil. It said that Pakistan Revenue Automation Limited (PRAL), instead of taking remedial measures to help resolve the issue, expressed inability to take action without formal directives from the board.
Sales tax along with other taxes and duties are paid through the BOAD in the following cases:
(a) Where the taxpayer is required to pay due to the difference in currency exchange rate or weight of the consignment etc.
(b) Imported raw material could not be used in manufacturing items of export with the prescribed time limit as per conditions of the Sales Tax SRO 492(I)/2009 dated June 13, 2009 and Customs SRO 490(I)/2001 dated June 18, 2001, respectively. The registered export-cum-manufacturers are allowed to import the specified raw material duty free and sales tax free for manufacturing items for export under SRO 492 and 490, respectively.
KTBA also informed that input tax adjustment in respect of sales tax/ FED in sales tax mode paid through BOAD or through Bill of Imports are neither being uploaded automatically in sales tax returns nor can be entered manually by the taxpayers. The KTBA has requested the board for making necessary adjustment in e-filing programme to enable taxpayers to enter such BOAD and Bills of Import relating to FED in sales tax mode in Annexure B till it is not linked with the Customs data.
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