The Daily Times reported that Pakistan’s Federal Board of Revenue has declared the steel makers and re roller mills are entitled to claim adjustment or refund of sales tax paid on procurement of plan, machinery and equipment. SRO 01 (i) 2012 issued by FBR stated that following further amendments shall be made in the Sales Tax Special Procedure Rules, 2007.

In aforesaid rule, in rule 58H in sub rule (6), after the full stop, the following shall be substituted, namely: However, the steel makers and re rollers paying sales tax on fixed rates through electricity bills shall be entitled to claim adjustment or refund of sales tax paid on procurement of plan, machinery and equipment.

Section 58 H of the Sales Tax Special Procedure Rules, 2007 relates to the payment of tax by steel makers, steel re roller and composite unit of steel melting and re rolling (having a single electricity meter), shall pay sales tax at the rate of PKR 6 per unit of electricity consumed for the production of steel billets, ingots and mild steel products, which will be considered as their final discharge of sales tax liability. Sub rule (6) of the Sales Tax Special Procedure Rules, 2007 states that steel makerss and re rollers, except Pakistan Steel Mills [Heavy Mechanical Complex] and Peoples Steel Mills, paying sales tax on fixed rates through electricity bills shall not be entitled to any input tax adjustment.

FBR through latest SRO 01 (i) 2012 has inserted this new rule in, in aforesaid rule, in rule 58H in sub rule (6), after the full stop, the following shall be substituted, namely: However, the steel melters and re rollers paying sales tax on fixed rates through electricity bills shall be entitled to claim adjustment or refund of sales tax paid on procurement of plan, machinery and equipment.

(Sourced from www.dailytimes.com.pk)