SALES TAX CIRCULAR NO. 04 OF 1995,

DATED 13TH APRIL, 1995

SUBJECT:-   LEVY OF ADDITIONAL TAX ON CASES FALLING UNDER SECTION 34 OF THE SALES TAX ACT,1990.

            Some questions have arisen regarding the additional tax under section 34 of the Sales Tax Act, 1990. These questions have been examined in consultation with the Justice Division and the following guidelines are laid down to ensure uniform practice in all the Collectorates.

2.         The additional tax and surcharge leviable under section 34 of the Sales Tax Act are in the nature of mandatory charge payable by tax payers who fail to pay the due amount of tax within the specified time. The provisions of  section 34 are attracted if there is failure on the part of tax payer to pay due tax in time. Section 36 of the Act does not exclude application of section 34; but the tax payer would be liable only in cases where element of failure is present on his part. Therefore, additional tax and surcharge under section 34 should be recovered after issuance of show cause notice, in the cases falling under sub-section (1) of section 36 but should not be recovered in cases covered by sub-section (2) of section 36.

3.            Whenever additional tax/surcharge under section 34 becomes chargeable either under section 6 or section 11 or section 36(1), it is to be calculated from the date when the tax actually became due under section 6.

4.         This supersedes Sales Tax Circular No.4/94. 

( Mr. Ahad Nawaz )

Secretary (STP)