(Revenue Division)
Central Board of Revenue
[Sales Tax & Federal Excise Wing]
*****
C. No. 4(80)STB/98. Islamabad, the 14th October, 2005.
SALES TAX CIRCULAR NO. 03/2005
SUBJECT: ADJUSTMENT OF INPUT TAX BY PAYPHONE/CELLULAR PHONE/ CALLING CARD COMPANIES AND WLL SERVICE PROVIDERS ON ACCOUNT OF PTCL BILLS.
Consequent upon issuance of SRO 1004(I)/2005 dated 23.09.2005, a number of companies providing the subject telecommunication services have approached the Central Board of Revenue stating that since PTCL bills are received by them on 15th day of the following month and are payable by 24th day of the following month, it is not possible for them to make adjustment of input tax on account of PTCL bills by 21st day of the following month by which date they are required to pay the Federal excise duty on their prepaid telecommunication services under SRO 1004(I)/2005 dated 23.09.2005.
2. The Board is pleased to clarify that for the purpose of input tax adjustment, utility bills are adjustable during the month in which the bills are paid. Therefore, for calculating their net tax liability for a tax period, the persons rendering or providing telecommunication services are required to make input tax adjustment on account of PTCL charges on the basis of the bills paid during the same tax period. In this way, such persons shall have ample time at their disposal to calculate their net tax liability and make payment of Federal excise duty in respect of the prepaid telecommunication services provided during a month, by 21st day of the following month.
(Wajid Ali)
Secretary (ST&FE-Budget)