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020402
GOVERNMENT OF PAKISTAN REVENUE
DIVISION CENTRAL BOARD OF REVENUE (SALES TAX WING)
SALES TAX RULING/INSTRUCTION NO. 27/2002
Islamabad, the 2nd April, 2002
C.No.4(47)/STB/98(Pt-II)
To
Lt. Col Akhtar Zaman,
Commander MES (DP),
TAXILA CANTT.
SUBJECT:
REGISTRATION OF CONTRACTORS WITH SALES TAX DEPARTMENT
I am directed to refer to your letter No.
6000/GST/06/E-6, dated 14th February, 2002 on the subject cited above and to
say that the clarifications provided to the officials who had earlier visited CBR were
actually as follows:-
(i) All Government departments, including defence organizations, are required to purchase
taxable goods only from registered persons on payment of sales tax and against tax
invoices. Therefore para (a) of your letter is correct.
(ii) there is no sales tax on repair of goods, vehicles etc. However, if the person making
repairs also provides spare parts, replacement parts, or any other taxable goods, the same
are chargeable to sales tax on their value. If the parts materials used in repair are
provided by the department (which obviously must be purchased on payment of sales tax from
some registered person) and the contractor only provides renders repair services, such
contractor is not required to be registered. Therefore para (b) of your letter id correct
to this extent.
(iii) there is no sales tax on immovable property such as buildings and road etc., since
these are excluded from the definition of goods’ under the Sales Tax Act, 1990.
Therefore, no sales tax is payable when a contractor constructs a building or a road for a
Government organization. However, any subsequent supply and installation of
airconditioners, fire fighting equipment, etc, for such buildings is taxable, as such
goods are not immovable property.
Sd/-
(DR. ASHFAQ AHMED TUNIO)
Secretary (Sales Tax)
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