Directorate of Controller General of Accounts (DCGA) of Accountants General of Pakistan Revenue (AGPR) has developed an automated solution in co-ordination with Federal Board of Revenue for deduction of sales tax from the vendors in order to avoid malpractices.
Sources said that now the SAP system would automatically verify sales tax registration status of a vendor and deduct applicable withholding tax amount from the vendor claims submitted at accounting office. They said that system would link up with the FBR database to determine the status of vendor's sales tax registration; authenticity of sales tax registration number; authenticity of allied master-data of the vendor in database of the accounting office and calculate correct amount of sales tax that would be withheld in line with the applicable rates as prescribed by the FBR.
Replying to a question, sources, said that the system after verification along with the aforesaid dimensions would ensure that the correct tax amount was deducted. They said that the system would block the bill for further proceeding in case of incorrect sales tax amount.
Furthermore, they said that full applicable rate of sales tax would be deducted from the claims of the vendors, if they were not enrolled in the FBR or did not get validated from its database. Sources said that all concerned department had been directed that all purchases should be made from the sales tax registered vendors who were active taxpayers otherwise system would automatically apply full applicable rates on vendors' claims.