Tax Book 2023

Chapter 12 Solved Past Papers Sales Tax Numericals of ICMAP Stage IV - (2003 to 2016)

Solution:

Beta (Pvt.) Limited

For the Tax Period December 2022

Output tax on: Rs. '000

Sales of locally manufactured taxable goods (20,000,000 x 17%) 3,400

Sales of locally manufactured detergents [(30,000 products X Rs.250)] x 17% 1,275

Sales of imported detergents to wholesalers [(31,250 products X Rs.250)] x 17% 1,328

Sales of imported finished goods on value addition basis (2,750,000 x 17%) 468

Total Output Tax (A) 6,471

Input tax on:

Local purchase of raw materials 1,488

Import of raw materials for in-house consumption 1,700

Import of finished goods - other than detergents [Rs. 2(M) x 20%] 400

Import of finished goods - detergents [Rs. 1(M) x 20%] 200

Total input tax (B) 3,788

1030___Conceptual Approach to Taxes

90% of output tax (Note - 1) (C) 5,823

Less admissible tax credit: lower of (B) or (C) (D) 3,788

Balance sales tax payable [A less D] 2,683

(N - 1)

(N - 2)

Spring - 2013 Q. 5 b

Rupees in million

Purchase of raw material from registered person

To manufacture Product A 900

Astheregisteredpersongiveninthisquestionisengagedinvarioustypesofactivitiesand

noneoftheclauseunderSRO1190(I)/2019datedOctober02, 2019 isapplicabletherefore

90% of output tax limitation on input is applicable U/S 8B of the Sales Tax Act, 1990.

3%furthersalestaxu/s3(1A)hasnotbeenchargedasthesuppliesaremadetoregistered

wholesalersand furtherfinal consumers (against supplies made) are notrequired to be

registered under the Sales Tax Act, 1990.

Hassan Associatesmanufacturesand suppliesProductA and Product B. Hassan Associatesis

registeredunder theSales Tax Act,1990. Followinginformationhasbeenextractedfromitsrecords

for the month of May 2023:

To manufacture Product A 900

To manufacture Product B 300

Purchase of raw material from unregistered person

To manufacture Product A 150

To manufacture Product B 200

Import of raw material to manufacture Product A and B 450

Sale of Product A

To registered person 800

To unregistered person 250

Sale of Product B

To registered person 500

To unregistered person 150

1030___Conceptual Approach to Taxes