Sales Tax, its scope and

computation
Basit, Faizan, Adnan
 Sales Tax

◈ This is the tax added onto the price of goods and services.

◈ Sales Tax is applicable under the Sales Tax Act, 1990.

◈ The law relating to the levy of a tax on the sale, importation,

exportation, production, manufacture or consumption of goods.

 Taxable goods

◈ "Goods" include every kind of movable property other than actionable

claims, money, stocks, shares and securities;

◈ "Taxable goods" means all goods other than those which have been

exempt

◈ All good which are applicable under the sales tax Act 1990
Normal rate of sales tax

 Sales tax @ 17% is charged, levied and paid on the value of:

 (i) taxable supplies made by a registered person any taxable activity

carried on by him; and

 (ii) goods imported into Pakistan irrespective of their final

destinations.
 Non Registerd Person

the taxable supplies are made to a person who has not obtained registration

number,

there shall be charged, levied and paid a further tax at the rate of 3% of the

value in addition to the normal rate of 17%.

For Example 17%+3%

 3

Faizan Khalid
Tax on taxable supplies specified in third schedule
◈ In the Third Schedule shall be charged to tax at the rate of 17% of the
retail price or in case such supplies:
◈ Fruit Juices and Vegetable Juices
◈ Toilet Soap, Shampoo
◈ Toothpaste. Milky Drinks
◈ Toilet paper & tissue paper
◈ Shoe polish and shoe cream
◈ Syrups. Mineral / Bottled water
◈ Cigarettes.Other household
Tax on taxable supplies specified in third schedule
◈ In the Third Schedule shall be charged to tax at the rate of 17% of the
retail price or in case such supplies:
◈ Fruit Juices and Vegetable Juices
◈ Toilet Soap, Shampoo
◈ Toothpaste. Milky Drinks
◈ Toilet paper & tissue paper
◈ Shoe polish and shoe cream
◈ Syrups. Mineral / Bottled water
◈ Cigarettes.Other household
 Capacity tax
On the goods specified in the Tenth Schedule, in lieu of levying and collecting tax on
taxable supplies on the capacity of goods.

• production capacity of plants, machinery,

• establishments or installations producing or manufacturing such goods

• at fixed basis,, from any person who is in a position to collect such tax due to the
nature of the business.
 Tax on supply to CNG stations

◈ In case of supply of natural gas to CNG stations, the Gas Transmission and

Distribution Company shall charge sales tax from the CNG stations at the rate of

17% on the value of supply to the CNG consumers.

 Liability to pay tax[Sect
The liability to pay the tax shall be:

◈ In the case of supply of goods in Pakistan, of the person making the supply, and

◈ In the case of goods imported into Pakistan, of the person importing the goods.
 3

Adnan Siddiqui
Registration and person required to be registered
◈ a manufacturer

◈ a retailer who is liable to pay sales tax an importer

◈ an exporter who intends to obtain sales tax

◈ wholesaler,

◈ dealer or distributor;
Special Tax Rates
◈ First & 2nd Schedule is Omitted
◈ 3rd Schedule 17% of retail Price
◈ 4th Schedule is Omitted
◈ 5th schedule is 0%
◈ 6th Exempt
◈ 7th Omitted
◈ 8th Special Tax rates for specified goods
◈ 9th Fix Tax on Mobile Phones
◈ 10th Fix Tax on Manufacture
◈ 11th Sales Tax withholding Rates
◈ 12th Value addition Tax
◈ 13th Minimum Production
 Computation of Sales Tax

◈ Output Tax
◈ Less Input Tax
◈ Taxpayable

Tax charged on Registered Person is 17%

Tax charged on Non- Registered Person is 17%+3%
 Example

Output Tax
⬩ Sales of goods to registered person 7500000 * 17% =12750000

Less Input Tax:

Purchases from registered person 4500000 * 17% =765000

Imports of goods 90000*17% =153000

Net Taxable = 357000

Thank You!
Any questions?

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