ISLAMABAD: The government has extended the sales tax exemption to newly-merged districts (NMDs) (FATA/ PATA) for another one year ending June 30, 2024. The Finance Bill 2023 has also granted exemption of sales tax on contraceptives and accessories.

Further, the grant of exemption of sales tax on plant saplings, combine harvesters, dryer for agricultural products, no-till-direct seeder, planters, trans-planters, other planters, and bovine semen has been announced.

The bill noted the withdrawal of exemption of sales tax on edible products sold in bulk under brand names or trademarks.

Further, the enhancement in reduced rate of sales tax from 12 per cent to 15 per cent on supplies made by the POS retailers dealing in leather and textile products has been announced in the budget.

Under the Finance Bill 2023, the requirement of shop area for tier-1 retailers is proposed to be withdrawn.

The Directorate General of Digital Invoicing and Analysis is proposed to be renamed as Directorate General of Digital Initiatives.

The scope of penal action is proposed to be enhanced by substituting the “cigarette packs” with “goods specified by the Board”. S No 12(xxv) of the Fifth Schedule is proposed to be amended by substituting the current description with the “Other drawing, marking out or mathematical calculating instruments (geometry box) (PCT heading 9017.2000)”.

The scope of S No 21 of Fifth Schedule providing zero-rating to exporter registered under the Export Facilitation Scheme, 2021 is proposed to be enhanced by inserting the word “commodities”.

For the purpose of clarification regarding the exemption of sales tax on transfusion sets not packed in the aluminium foil imported in one consignment with the blood

bags, the explanation is proposed under S No 121 of Table-1 of the Sixth Schedule.

Omission of S No 159 and 160 of Table-1 of the Sixth Schedule is proposed being redundant as the time-bound exemption has already expired on 31.12.2021.

Production, transmission and distribution of electricity are proposed to be excluded from the purview of sales tax in accordance with the decision of the National Tax Council.

Copyright Business Recorder, 2023