The Federal Board of Revenue (FBR) here on Wednesday issued a new procedure for processing of sales tax refund claims of recognised agriculture tractors manufactures.
In this regard, the FBR has issued new rules called, "Refund Claims of Recognised Agriculture Tractors Manufactures Rules-2012" to repeal the "Refund Claims of Recognised Agriculture Tractors Manufactures Rules-2005".
According to the FBR, in pursuance of Economic Co-ordination Committee (ECC) decision, the rate of sales tax on import and supply of agriculture tractors was reduced from 16 percent to 5 percent to be gradually raised to the level of 16 percent vide SRO 79(I)/2012, dated February 2 2012. However, all supplies by their vendors of agriculture tractors sector were subject to 16 percent sales tax. Due to difference in the rate of sales tax chargeable on inputs and agriculture tractors, refunds of unadjusted input started to accrue keeping in view of previous such arrangement vide SRO 948(I)/2005, dated September 13, 2005, a new updated procedure for processing of refund claims of Recognised Agriculture Tractors was notified through SRO 363(I)/2012, dated April 13, 2012, repealing aforementioned old SRO, FBR added.
The FBR procedure said that the new rules shall come into force at once and shall be deemed to have taken effect on February 2, 2012.
The refund claimant shall file a refund application to the Commissioner, Inland Revenue having jurisdiction, along with the necessary documents. It included a copy of tax paid and e-filed sales tax return; an undertaking affirming the genuineness of refund as per Sales Tax Act, 1990 and relevant rules made thereunder and a revolving bank guarantee valid for at least 90 days issued by a scheduled bank, to the satisfaction of the Commissioner Inland Revenue having jurisdiction, of an amount not less than the average monthly refund claim during last 12 months.
The refund of admissible excess input tax shall be allowed on the basis of above documents within three days of receipt thereof.
In case of filing of complete refund claim, the procedure said that within 15 days of the sanctioning of refund, the claimant shall file a complete refund claim along with the requisite supportive documents prescribed in rule 38 of the Sales Tax Rules, 2006, except the statement prescribed in clause (e) of sub-rule (1) of the said rule which shall be submitted biannually. A soft copy of the claim on the prescribed format shall also be submitted which shall be scrutinised under the Sales Tax Act, 1990, and the rules made thereunder, and the objections, if any, related to the refund claim shall be conveyed to the claimant within 30 days of the receipt of claim.
In case any amount already sanctioned and paid is found inadmissible, the same shall be recovered within seven days by en-cashing the bank guarantee to the extent of adjudged liabilities.
The Commissioner, Inland Revenue shall appoint and notify an officer, not below the rank of Assistant Commissioner, as focal person in the concerned Large Taxpayer Unit to liaise with other Regional Tax Offices or Large Taxpayers Units, as the case may be, regarding the problems or objections encountered on account of supplies of the refund claimant for speedy solution thereof, rules said.
The new rules added that the provision of sub section (1) of section 8B of the Sales Tax Act, 1990 shall not be applicable on refund claims of admissible excess input tax filed under these rules.