ISLAMABAD: Pakistan Association of Auto Parts and Accessories Manufacturers (Paapam) has appealed to Finance Minister Ishaq Dar and FBR Chairman Tariq Bajwa to resolve the issue of two percent extra sales tax on non-retail sales of auto parts which has been under discussions for the past four months.
According to Paapam Chairman Usman Malik, despite reaching a consensus on the issue, the long delay in withdrawal of 2pc extra sales tax on non-retail sales of auto parts had created uncertainty. He regretted that the sales of auto parts industry had declined as the association members were still receiving notices for immediate payment of the tax.
He pointed out that vide Finance Act, 2013, 15 new items were added in the 3rd Schedule of Sales Tax Act, to levy sales tax on retail prices of these items. However, in view of hardships faced by registered persons, FBR excluded 11 items from 3rd Schedule, and in lieu of charging sales tax on retail prices, extra sales tax at 2pc was levied on these items through SRO No 896 dated 4-10-2013.
Usman Malik said that while Paapam was paying 2pc extra sales tax on auto parts supplied directly to the market which was not apply to auto parts supplied to automobile manufacturers. He urged the FBR Chairman and Finance Minister to immediately issue SRO to the effect that non-retail sales of auto parts should be exempted from 2pc extra sales tax.
