Tax Book 2023

Chapter 12 Solved Past Papers Sales Tax Numericals of ICMAP Stage IV - (2003 to 2018)

W-3: Apportionment of Input Tax

Rupees Rupees

Taxable supplies Supplies Input Tax Status

Zero-rated supplies 3,162,000 390,087 Adjustable

Exempt supplies 17,000,000 209,724 Refund

650,000 80,189 Lapsed

5,512,000 680,000

Q. NO. 5 Spring 2017

Kamiran Limited (KL), being as unlisted company registered under the Sales Tax Act, 1990, is

engaged in the import, export and distribution of consumer goods for last several years. KL has

recently expended its business by setting up a manufacturing unit for various consumer goods.

(Note - 2) 90% restriction u/s 8B on input tax in case of a company is applicable subject to

restriction, limitations and conditions of the Sales Tax Act, 1990.

(Note - 1) Assumed that supplies invoices to un registered persons have NTN or CNIC of

recipients, as applicable only on distributors otherwise proportionate input tax shall be

disallowed under section 8(1)(m) of the Sales Tax Act, 1990.

Conceptual Approach to Taxes____1023

Other information:

recently expended its business by setting up a manufacturing unit for various consumer goods.

The manufacturing uinit will start production from the month of July 2023.

(a) compute the net sales tax liability by KL for the month of June 2023 with proper working and

reasoning where any given information has not been utilized in computation.

. Imported 8,000 boxes of aproduct' Hair Serum' Rs. 500 per box, each box contain 5 small
injections and sold as complete box in market. 5,000 imported boxes were sold by KL in local
market at Rs. 600 per box whereas 500 of imported boxes were re-exported to vietnam and Sir
Lanka at Rs. 2,500 per box.
. Purchased 6,000 packs of another product' Toothpaste' srom local suppliers at a cost of Rs.
135 per pack. Toothpaste is included in the items listed on the Third Schedule to the Sales Tax
Act, 1990. The retail price of Toothpaste is Rs. 150 per pack. KL sold the entire stock to a
retailer at a price of Rs. 140 per pack during the month.

.Paid sales tax of Rs. 1,200,000 for acquiring new plant at and equipments for its

manufacturing unit and Rs. 60,000 for annual dinner and entertainment for its employees.

.Imported price of Rs. 500 for Hair Serum box is inclusive of customs duty of Rs. 25 per box and the

rate of sales tax paid on commercial import of Hair Serum is 20%.

Required:

Following transactions were carried out by KL during the month of June 2023.

reasoning where any given information has not been utilized in computation.

(b) compute the amount of refund against export of commercial import of Hair Serum

Conceptual Approach to Taxes____1023