Federal Government is pleased to make the following rules

Government of Pakistan Ministry Of Finance, Economic Affairs Statistics and Revenue (Revenue Division) ******* Islamabad, the 6th June, 2005 NOTIFICATION (SALES TAX) S.R.O. 539(I)/2005.- In exercise of the powers conferred by section 71 of the Sales Tax Act, 1990, read with clause (9) of section 2, section 3, 3AA and 4, sub-section (2) of section 6, section 7A, clause (b) of sub-section (1) of section 8, clause (a) of sub-section (2) of section 13, sections 26AA and 34A, and first and second provisos to section 45 thereof, the Federal Government is pleased to make the following rules namely:- 1. Title, extent and commencement.- (1) These rules may be called Payment of Sales Tax by Retailers of Specified Goods (Special Procedure) Rules ,2005. (2). Subject to rule 6, these rules shall apply to retailers engaged in the supply of such goods as are specified in clause (e) of sub-rule (1) of rule 2. (3) They shall come into force with effect from the first day of July,2005. 2. Definitions.-(1) In these rules, unless there is anything repugnant to the subject or context,- (a) “Act” means the Sales Tax Act, 1990; (b) “Annex” means an annex appended to these rules; (c) “application” means application for registration as a retailer as specified in form ST-I annexed to Chapter I of the Sales Tax Rules, 2005; (d) “return” means retail tax return-cum-payment challan specified in Annex-A; (e) “specified goods” means textile fabrics, textile made-ups, garments and articles of textile including home textiles, articles of leather, carpets, surgical goods and sports goods; and (f) “turnover”, with reference to any particular tax period or periods, means total sales made by a retailer in respect of goods referred to in clause (e) during such period. (2) All other terms and expressions used but not defined herein shall have the same meanings as are assigned to them in the Act. 3. Registration.- (1) Every person liable to be registered as a retailer under these rules shall, if not already registered, make an application for registration to the Collector having jurisdiction in the area where his business premises are located, in the manner prescribed in Chapter I of the Sales Tax Rules, 2005. (2) The exemption available to the retailers having annual turnover below the threshold specified in entry at Serial No.3 in column (2) of Table 2 of the Sixth Schedule to the Act, shall be available to the retailers of goods referred to the clause (e) of sub-rule (1) of rule 2. (3) Where a retailer operates different branches, divisions or retail outlets at more than one place, he shall apply for registration to the Collector having jurisdiction over the place where his head office is located. (4) The Collector shall, after having satisfied himself with the bona fides of the information provided in the registration application, forward the case to the Central Registration Office in the Board, and the Central Registration Office shall, after such verification as it may deem necessary, issue registration certificate as per prescribed procedure. 4. Levy and rate of tax.- Notwithstanding the Notifications S.R.O. 535(I)/2005 and S.R.O. 536(I)/2005 both dated 6th June 6, 2005, issued by the Federal Government under clause (c) of section 4 of the Act; and subject to sub-rule (2) of rule 3, all goods specified in clause (e) of sub-rule (1) of rule 2 shall be charged to tax at the rate of three per cent ad valorem at the time of their supply or sale by retailer and tax on such supplies or sales shall be levied, collected and paid accordingly. 5. Determination of sales tax liabilities.-(1) A retailer shall pay retail tax at the rate specified in rule 4 on his monthly turnover of goods mentioned in clause (e) of sub-rule (1) of rule 2. (2) The tax paid by the retailers operating under these rules shall be treated as the discharge of tax liability for the purpose of sales tax (two per cent) as well as for income tax (one per cent) provided that in case of corporate sector retailers covered under these rules one third of the tax paid shall be treated as withholding income tax adjustable against the final income tax liability. 6. Adjustment.- (1) The retailer shall not be entitled to adjustment of any tax on any account whatever. (2) No registered person shall be entitled to adjustment of tax charged on his invoice or cash memo by a retailer operating under these rules. 7. Filing of return and payment of retail tax.- (1) Every retailer operating under these rules shall furnish monthly return for a tax period in the designated branch of National Bank of Pakistan in the manner specified in section 26AA of the Act and deposit the tax due from him accordingly. (2) In case any retailer files return after due date or fails to make payment of tax or makes short payments, he shall be liable to pay penalty or as the case may be, default surcharge due under the Act. 8. Decision on issues.- Where a question is raised whether any retailer qualifies for the benefit of these rules or whether any goods or class of goods in which any person is doing retail business, are covered under these rules shall be decided by the Collector in consultation with the association of the concerned industry or sector and where any such question remains undecided at the level of Collector, the question shall be decided by the Board. 9. Instructions by the Board.- In order to carry out the purpose of these rules and to resolve the ancillary issues and matters incidental thereto, the Board may through general order or otherwise issue instructions. 10. Miscellaneous.-All provisions of the Act and the rules made thereunder, in so far as they are not inconsistent with these rules shall apply, mutatis mutandis, to the retailers registered and operating under these rules.