TAXATION

FBR Suspends Sales Tax collection On Sugar from manufacturers

The Federal Board of Revenue (FBR) has suspended the provision of sales tax collection on sugar from the manufacturers on the basis of the retail price up to November 30, 2021.

The FBR on Thursday issued an SRO No 989(I)/2021 for not charging sales tax on sugar under the Third Schedule to the Sales Tax Act, 1990 for a particular time period.

According to the SRO, “in the exercise of the powers conferred by the proviso to clause (a) of sub-section (2) of section 3 of the Sales Tax Act, 1990, the Federal Government is pleased to direct that the provisions of S. No. 50 of the Third Schedule to the Sales Tax Act, 1990 shall not be applicable for the period commencing on July 1, 2021, and ending on November 30, 2021,” it added.

The entry number 50 of the Third Schedule to the Sales Tax Act, 1990, relates to the application of sales tax on the basis of printed retail price on sugar, except where it is supplied as an industrial raw material to pharmaceutical, beverage, and confectionery industries. Now, this collection of sales tax, on the basis of the printed retail price, would not be applicable from July 1, 2021, to November 30, 2021.

Recently, the federal cabinet has decided that the implementation of sales tax on sugar will be at ex-mill price till November 30, 2021. During the last budget, the sales tax was imposed on the retail price of sugar and the cabinet decision to implement the sales tax on ex-mill price would cause a positive impact on prices of sugar and its availability.

Table of Contents

SRO 989(I)/2021

“Islamabad, the 5th August, 2021. SRO 989(I)/2021.- In exercise of the powers conferred by the proviso to clause (a) of sub-section (2) of section 3 of the Sales Tax Act, 1990, the Federal Government is pleased to direct that the provisions of S. No. 50 of Third Schedule to the Sales Tax Act, 1990 shall not be applicable for the period commencing on the 1st day . of July, 2021 and ending on the 30th day of November, 2021.

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