ISLAMABAD: The Federal Board of Revenue (FBR) has proposed increase in sales tax rates for steel melters, re-rolling mills and ship-breakers in the upcoming budget (2014-15) to generate additional revenue of Rs6 to 8 billion.
As per reports, the FBR has drafted amendments to Sales Tax Special Procedure Rules for steel melters, re-rollers and ship breakers. It has been proposed to rationalise sales tax rates for these sectors.
In principle, special procedures should be developed on the basis that net payable amount under normal regime at standard rate, be collected under special procedure to facilitate tax administration and enhance compliance. This principle needs to be re-applied in the case of steel melters, re-rollers and ship breakers. At the same time, the balance between steel melters and ship breakers requires to be maintained in budget (2014-15).
The FBR has worked out calculations for the revision of the sales tax rates on steel melters, re-rollers and ship-breakers. For steel melters, the FBR has proposed raising sales tax of Rs4 per unit of electricity to Rs12.5 per unit of electricity in budget (2014-15). Another proposal under consideration is to revise the sales tax from Rs5,862 per metric ton (PMT) to Rs 9,602 PMT for ship breakers. Similar kind of other calculations have been done to rationalise sales tax rates on the said sectors.
