Sindh announces sales tax amnesty

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KARACHI: The Sindh Revenue Board (SRB) on Thursday announced an amnesty scheme, comes into immediate effect, for citizens who have so far failed to pay sales tax on services starting from July 1, 2011.

The scheme, notified through SRB-3-4/6/2014, has given exemption from penalty along with 95 per cent from default surcharge payable against principal amount of arrears of the tax on services, provided the taxpayers pay their outstanding dues along with 5pc default surcharge by April 30. However, the SRB has also asked the taxpayers availing amnesty scheme to file their revised tax returns, as the case may be, for the relevant tax periods through e-filing in the prescribed manner by May 9, 2014.

The SRB sources said that the need for announcing tax amnesty scheme was necessitated from the fact that sales tax on services being collected by provinces after the 18th Amendment is relatively new and ever since there had been a lot of confusion due to lack of proper knowledge.

A high-ranking official of the SRB told Dawn that since penalty and default surcharge are not adjustable liabilities and keep on accumulating against defaulting taxpayers, therefore, it was strongly felt by the Board to provide a relief to taxpayers by giving complete exemption against penalty and 95pc against default surcharge.

He explained that default surcharge, which is normally imposed at 2pc above the Kibor, becomes huge liability for taxpayers who could not afford to pay it. This gave all the reason to the SRB to announce the amnesty scheme, he added.

The benefits of exemption given under the amnesty scheme, inter alia will also be available against arrears of tax under the Sindh Sales Tax Ordinance, 2000 and the Sindh Sales Tax on Services Act 2011.

The notification further states that if the whole of the dues of the principal amount of tax and of 5pc of the default surcharge are paid by a person in terms of this notification, he shall not be prosecuted under Section 49 of the Act and the offence, to the extent of the arrears of the tax paid under this notification, will also be compounded under Section 46 of the Act.

Similarly, if the principal amount of tax and the 5pc of the amount of default surcharge thereon, by persons who short-paid any amount of tax in their tax returns, under litigation, are still under assessment or against whom tax liability has been adjudged or confirmed by the Commissioner (appeals) or appellate tribunal will be allowed to make tax adjustment or get refund.

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