ISLAMABAD: The Federal Board of Revenue (FBR) has expanded the scope of sales tax suspension of registered persons.
According to the amendments introduced in the Sales Tax Rules 2006, the FBR has elaborated conditions for suspension of sales tax registered persons. The suspension can occur if refusal to allow access to business premises inspection refused under Sections 40B and 40C of the Sales Tax Act.
Moreover, records demanded under sections 25 and 37 are not provided would be liable to suspension.
FBR imposes major restrictions on ST-registered persons
The suspension could take place in cases of disproportionate activity. The business turnover becomes five times more than the sum of declared capital and liabilities; transactions with suspended persons; making purchases from or sales to suspended persons exceeding 10 per cent of total purchases/supplies, or exceeding Rs50 million, whichever is higher; non-filing of sales tax returns; non-filing for three consecutive months; null filing (zero activity) for six consecutive month and tax fraud activity detected under Section 2(37).
Revocation of suspension must occur within 30 days of receiving the taxpayer’s reply to the suspension notice, tax expert added.
“Tax fraud” is now specifically linked to clause (37) of Section 2 of the Sales Tax Act, 1990.
Copyright Business Recorder, 2025
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