SALES TAX DEDUCTION TO BE MADE THROUGH AUTOMATED SYSTEM FROM 1ST
Chitral Times Report
Islamabad: Federal Board of Revenue (FBR) has developed a
software for automated verification of Sales Tax Registration
Number (STRN) and deduction of applicable rates of sales tax from
the vendorsí claims submitted at accounting offices.
The system will be implemented across all accounting offices from
the start of the financial year 2016-17 and is expected to
significantly enhance the performance of accounting offices in
their role as withholding tax agents for the government, and
contribute substantively to the governmentís sales tax collection.
The system will link up with FBR database to determine status of
vendorís Sales Tax Registration and authenticity of Sales Tax
Registration Number (STRN) as well as authenticity of allied
master-data of the vendor in database of the Accounting Office, and
calculate correct amount of sales tax to be withheld in line with
the applicable rates as determined by FBR.
Based on verifications along the above mentioned dimensions, the
system will deduct applicable rates i.e. 10%, 20% and 100% of the
sales tax. Full applicable rate of sales tax shall be deducted from
claims of those vendors who do not have STRN, whose STRN does not
get validated from FBR data base or who are blacklisted.
The software was developed by the IRS-Operations Wing of FBR in
collaboration with the office of Controller General of Accounts (CGA)
following a pilot project launched earlier this year at AG Office
Islamabad in collaboration with FABS.
Ahead of the software implementation on 1st July 2016, FBR has
already started contacting the government departments and
ministries to instruct their concerned staff to ensure that
purchases are made from registered vendors as well as ascertain
that vendorsí STRN and master-records with Accounting Offices are
validated to avoid deduction of full applicable sales tax from