The Central Board of Revenue (CBR) has dropped the idea of promulgating Value Added Tax (VAT) Act, 2007 in coming budget keeping in view the legal complications following issuance of a totally new sales tax law in fiscal 2007-08.
Sources told Business Recorder on Saturday that the board would amend the exiting Sales Tax Act, 1990, to simplify all the existing sales tax/federal excise returns, statements and declarations.
The proposed amendments have been worked out on the recommendations of a "Process Simplification Committee", which has reviewed the entire sales tax law with a view to removing ambiguities, making the procedure simple. According to the sources, the draft of the VAT Act, 2007 has been finalised, but it would not be implemented from the next fiscal year.
The sales tax law has been reviewed by a committee headed by Iftikhar Qutab, collector, Sales Tax and Federal Excise, Large Taxpayer Unit (LTU), Karachi. Other members are Shafquat Mehmood Ahmed, collector, Enforcement, Karachi; Abdur Rashid Bajwa, collector, Sales Tax and Federal Excise, Regional Tax Office (RTO), Peshawar; Abdul Hameed Memon, secretary, Sales Tax and Federal Excise, and Aamir Amin Bhatti, deputy collector, Collectorate of Sales Tax and Federal Excise, Lahore.
The committee has redrafted sales tax statutes and regulations. Secondly, it has redesigned all formats of returns, declarations and statements, etc. Thirdly, it has adopted best international practices for sales tax legislation/system.
Fourthly, it has simplified the statutory and regulatory machinery of sales tax. Fifthly, it has ensured futuristic compatibility of returns, declarations, statements and sales tax documents with the information technology applications.