FBR tax officers at cement plants to stop misuse of input adjustments

ISLAMABAD: The Federal Board of Revenue (FBR) has invoked Section 40B of Sales Tax Act 1990 and deputed tax officers at selected big cement plants of the country in order to monitor actual production and stopping misuse of input adjustments.
“After ascertaining reasons for consistent decline in sales tax at domestic front, the FBR deputed tax officers at selected biggest cement plants of the country, resulting into surge in revenue collection in the range of around 9 percent in first four and half months period of the current fiscal year,” a top official of the FBR told The News here Friday. After identifying loopholes internally, the official said the FBR took steps against beverage and cement industry, helping the tax machinery for reversing revenue collection at sales tax at domestic stage. During the last two years, the collection of GST on domestic front has largely witnessed negative growth, but in first four and half months period of the current fiscal year, the GST on domestic front achieved growth close to double digit. The FBR has recently found that some cement plants were allegedly involved in getting massive input adjustments, so officers were deputed to monitor activities on ground in order to avoid such misuse.
Under Section 40B of Sales Tax Act 1990, subject to such conditions and restrictions as deemed fit to impose, the Board, or chief commissioner may post officer of Inland Revenue to the premises of registered person or class of such persons to monitor production, sale of taxable goods and the stock position: Provided that if a commissioner, on the basis of material evidence, has reason to believe that a registered person is involved in evasion of sales tax or tax fraud, he may, by recording the reason in writing, post an 6 (Inland Revenue] to the premises of such registered person to monitor production or sale of taxable goods and the stocks position).
Explanation: For the removal of doubt, it is declared that the powers of the Board, chief commissioner and commissioner under this section are independent of the provisions of Section 40. Under Section 40C, monitoring or tracking by electronic or other means. -- (1) Subject to such conditions, restrictions, and procedures, as it may being fit to impose or specified, the Board may, by notification in the official gazette, specify any registered person or class of registered persons or any good or class of goods in respect of which monitoring or tracking of production, sales, clearances, stocks or any other related activity may be implemented through electronic or other means as may be prescribed (2) From such date as may be prescribed by the Board, no taxable goods shall be removed or sold by the manufacturer or any other person without affixing tax stamp, bandrole stickers, labels, (barcodes,) etc. in any such form, style and manner as may be prescribed by the Board in this behalf.
(3) Such tax stamps, banderols, stickers, labels, barcodes etc., shall be acquired by the registered person referred to in sub-section (2) from a licensee appointed by the Board for the purpose, against price approved by the Board, which shall include the cost of equipment installed by such licensee in the premises of the said registered person.