The Federal Board of Revenue (FBR) and Khyber Pakhtunkhawa Revenue Authority (KPRA) will sign a Memorandum of Understandings (MoU) on the cross-adjustment of sales tax being levied on goods and services by both the federal and provincial government. Sources told Business Recorder here on Monday that the issue of inking a MoU between the FBR and the KPRA was discussed during last meeting of Chief Secretary KPK with FBR Chairman Tariq Bajwa and Secretary Finance.
On the issue of cross-adjustment, sources said that Chairman FBR urged the government of Khyber Pakhtunkhawa to immediately sign the MoU with FBR on the lines of Sindh Revenue Board (SRB) and Punjab Revenue Authority (PRA), so that matter of cross-adjustment is streamlined.
Legal Advisor Khyber Pakhtunkhawa (KP) was of the view that the demand of the Province is precisely opposite, as it wants that input sales tax on goods paid by the telecommunication companies at the import stage shall not be adjusted against sales tax on services, to which Chairman FBR plainly refused to agree. Chief Secretary KP was also of the opinion that the province can't be treated differently but decided that the matter shall be discussed while signing the MOU with KP authorities, so that it should be in line with MoUs signed with Sindh and Punjab. Chief Secretary KP directed that KPRA shall immediately procure copies of these MoUs from their respective counterparts in both the Provinces and examine the matter with help of Finance Department to remove any ambiguity if any.
Chairman FBR urged that KPRA, being a fresh Revenue Authority shall liaise more frequently with SRB and PRA to remain intact on matters pertaining to current issues. The Chief Secretary KP agreed to the suggestions made by the FBR Chairman.
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