Purchasing from non-active taxpayers: government departments, autonomous bodies barred

The Federal Board of Revenue (FBR) has barred government departments, autonomous bodies and public sector organisations from making any purchases from non-active taxpayers. According to a notification issued here on Wednesday, a registered person who does not fulfill any of the conditions prescribed in clause (1) of section 2 of the Sales Tax Act shall automatically become a non-active taxpayer and his name shall be removed from the active taxpayers list maintained by the Board.
A non-active taxpayer shall not be entitled to file Goods Declarations for import or export; issue sales tax invoices; claim input tax or refund or avail any concession under the Act or rules made thereunder. No person, including government departments, autonomous bodies and public sector organisations shall make any purchases from a non-active taxpayer, FBR said.
In case of entry of an invoice issued by a non-active taxpayer by any registered buyer in Annexure-A of his return, a message shall appear to the effect that the supplier is a non-active taxpayer and no input tax credit shall be admissible against such invoice. A non-active taxpayer may be restored as active taxpayer, if the registered person files the return or statement along with payment of any tax due under the Act or Income Tax Ordinance, 2001. The RTO or LTU having jurisdiction, on satisfying itself after conducting such audit or other investigation as may be necessary, recommends to the Board for restoration and the Board issues an order to such effect.