FBR to bind suppliers to include goods’ weight in sales tax invoice

KARACHI: The apex tax authority is weighing an option to bind suppliers to mention weight of goods in the sales tax invoice to ensure accurate valuation based on the existing market prices, official sources said on Saturday.
The sources said the Federal Board of Revenue (FBR) is planning to make it mandatory for a supplier to feed weight of goods into its invoice issued to purchaser to ensure the amount mentioned in the invoice matching the prevailing rates of such goods.
This will help FBR in plugging revenue leakages.
Presently, the issuer of sales tax invoice shows amount received from the purchaser.
“The new module will be launched after consulting with all the stakeholders,” said an official.
The information technology wing of FBR is working to integrate this module in the present Integrated Risk Information System, which enables real-time transactions of suppliers and purchasers and processes all the invoices.
The tax authority is further improving its database of suppliers and purchasers
FBR has brought several changes to sales tax regime, especially to prevent losses through fake refunds and wrong input adjustments over the past few months.
It has introduced the HS Code in the invoice system to ensure that the buyers and sellers should not misuse the facilities of exemptions and concession granted to several sectors.
The sources said the only first four digits of HS code of Chapter 1-98 of Pakistan Customs Tariff have been allotted, while further four digits will be added soon to ensure the transaction of specific goods.
Furthermore, they said FBR has also introduced biometric system for the sales tax registration to curb bogus refund claims.
In past, multibillion rupees of refunds were obtained on fake invoices by persons who deemed registered, but post-audit clearance process they were found nonexistence.
Tax officials said the board wanted to set the weight feeding requirement when HS code was introduced, but it couldn’t do so due to pressure from the business community.