20000225

Hides, skins liable to sales tax: CBR

RECORDER REPORT

ISLAMABAD: The Central Board of Revenue (CBR) has explained to the Pakistan Tanners Association that the supply of hides and skins is liable to sales tax, it was learnt on Thursday.

In this regard, the CBR said, it had also consulted the Law and Justice Division, which has confirmed the levy of sales tax on hides and skins.

Secondly, the board has asked the association to approach the Member (Export), CBR, regarding the matter of withdrawal of show-cause notices issued to the members of Pakistan Tanners Association.

In a communication to the PTA, the CBR has clarified that the matter and it is held that hides and skins (of PTC Chapter 41) are not covered by S1.NO. 2 of the Sixth Schedule to the Sales Tax Act, 1990 as "agricultural produce of Pakistan, not subjected to any further process of manufacture". Being not otherwise exempt under any of the provisions of section 13 of the Sales TAX Act, 1990 or under any of the entries in the Sixth Schedule thereof, the supply of hides and skins are liable to sales tax.

The board has further said that regarding withdrawal of show-cause notices issued to some members of the Pakistan Tanners Association, it is stated that the matter relates to customs notification SRO 1319 (I)/ 96 issued on November 24, 1996, the association should take up the matter with the Member (Export) CBR.