Tax Book 2023

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

Sales tax refundable related to export supplies (Note 3) (1,400,168)

(N - 1)

(N - 2) Apportionment of taxable supplies input tax

[U/R 25 of Sales Tax Rules, 2006] Supplies Input tax

Rs. Rs.

Local supplies (gross) 82,720,000 9,119,832

Export sales 12,700,000 1,400,168

95,420,000 10,520,000

(N - 3)

Asthezeroratedsuppliesarelessthan50%ofalltaxablesuppliesunderSRO1190(I)/2019

datedOctober02,2019,therefore90%limitationisapplicableU/S8BoftheSalesTaxAct,

1990. The said limitation is not applicable on input tax paid on acquistion of fixed assets.

Ithasbeenassumedthat3%furthertaxu/s3(1A)isapplicableonlocaltaxablesuppliesto

unregisteredpersons(beingasfinalconsumers)underSRO648(I)/2013datedJuly09, 2013

hencethesameshallbeaccountedforandpaidseperatelywithoutadjustmentofthesame

againstinputtax/refundoftheregisteredpersonandfurtheritshallalsonotbeconsideredfor

3% further sales tax payable on supplies to un-registered persons

1036___Conceptual Approach to Taxes

(N - 4)

Summer - 2011 Q. 4(b)

The following information relate to XYZ (Pvt) Ltd., for the month ended December 31, 2022:

Rs.

Taxable supply 5,000,000

Exempt supply 1,000,000

Zero-rated supply 2,000,000

Total supply 8,000,000

Purchase of raw materials used in taxable & zero-rated supply 4,500,000

Purchase of raw materials used in exempt supply 550,000

Required:

Compute the amount of sales tax liability / refund of the company.

(Note - 5) 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.

NofurthertaxhasbeenchargedonsuppliescoveredunderFifthScheduletotheSalesTax

Act, 1990 by virtue of SRO 585(I)/2017, Dated: 01/07/2017.

againstinputtax/refundoftheregisteredpersonandfurtheritshallalsonotbeconsideredfor

the computation of 90% limitation on output tax.

Solution:

XYZ (Pvt) Ltd

Computation of sales tax liability for the month ended December 31, 2022.

Rs. Rs.

Output tax:

On taxable supply U/S 3 (Rs. 5,000,000 x 17%] 850,000

On exempt supply [U/S 6 read with 6th Schedule] -

On zero rated supply [U/S 5 read with 5th Schedule] -

850,000

1036___Conceptual Approach to Taxes