Imported items: Payment of minimum value addition ST excluded

The Federal Board of Revenue (FBR) has excluded payment of minimum value addition sales tax on imported items falling under Third Schedule (retail price items) of the Sales Tax Act. The FBR has issued a notification here on Friday.

According to a tax expert, It is important to note third schedule items are chargeable to sales tax on retail price basis. The FBR in budget 2019-20 has extended scope of retail price on imported items. These imported items are required to declare retail price or get their goods clear on 30% value addition as retail price. Since sales tax in advance on retail price is already been collected there was no rationale to charge minimum value addition sales tax in terms of 12th schedule of the sales tax act 1990. The same was therefore excluded through this notification to rationalize the law.

Copyright Business Recorder, 2019