GOVERNMENT
OF PAKISTAN
MINISTRY
OF FINANCE, ECONOMIC AFFAIRS,
STATISTICS
AND REVENUE
(REVENUE
DIVISION)
*****
NOTIFICATION
(SALES
TAX)
S.R.O.
806 (I)/2001.- In exercise of the powers conferred by section 71 of the
Sales Tax Act, 1990, the Federal Government is pleased to make the following
rules, namely:--
1.
Short title, application and commencement. -- (1)
These rules may be called the Zero-rating of Hand-Knotted Carpets Rules, 2001.
(2) They
shall apply to supplies of hand-knotted carpets by registered persons to foreign
nationals against payment in foreign exchange through a foreign credit card for
subsequent export as personal baggage of the foreign nationals.
(3)
They shall come into force at once.
2.
Definitions.-- In
these Rules, unless there is anything repugnant in the subject or context,--
(a)
“Act” means the Sales Tax Act, 1990;
(b) “carpet” means a hand-knotted carpet of Pakistan origin;
(c)
“foreign currency” means foreign currency as defined in clause (c) of
section 2 of the Foreign Exchange Regulation Act, 1947 (VII of 1947);
(d)
“foreign credit card” means a credit card issued outside Pakistan by
a foreign bank or foreign credit card company, payment of which is made in
foreign exchange;
(e)
“foreign national” means a person who has nationality other than of
Pakistan, and holds a valid foreign passport at the time of visit to Pakistan;
(f)
“foreign passport” means a valid passport of a country other than
Pakistan;
(g)
“Import and Export Procedure Order” means the Import and Export
Procedure Order for the time being in force, issued by the Ministry of Commerce,
Government of Pakistan;
(h)
“registered supplier” means a person registered under the Act, making
supplies of hand-knotted carpets of Pakistan origin;
(i)
“valid identification” means an officially issued document or card
such as an identity, a driving license or service card, bearing a photograph by
which the holder thereof can be positively identified;
and
(j)
“zero-rated invoice” means a zero-rated invoice issued under sub-rule
(2) of rule 4.
3.
Supply deemed to be export.--A
supply of carpets under these rules shall be deemed to be an export for the
purposes of section 4 of the Act, provided the procedure prescribed in these
rules is observed and foreign currency against the supply is received in terms
of rule 6.
4.
Issuance of zero-rated tax invoice.--
(1) Any foreign national desirous of taking a zero-rated supply of carpets from
a registered supplier shall make payment in foreign currency through a foreign
credit card and present his foreign passport or valid identification to the
supplier for noting the particulars in the invoice.
(2) The
supplier shall issue a zero-rated tax invoice, mentioning therein the name,
address and passport number of the foreign buyer, price of each carpet in
foreign currency, the number of the foreign credit card and name of its issuing
authority besides the particulars required under section 23 of the Act.
(3) The
foreign national shall sign a receipt-cum-undertaking in the form as set
out in the Annexure to these rules.
5.
Export of carpets as personal baggage.-- (1)
The export of carpets as personal baggage by foreign nationals shall be allowed
by the customs authorities on production of a zero-rated invoice and subject to
the conditions of the Import and Export Procedure Order.
(2)
If a foreign national is unable to produce a zero-rated invoice but
fulfills the conditions of the Import and Export Procedure Order, export shall
be allowed by the customs authorities after obtaining the name and address of
the supplier which shall be communicated to the concerned sales tax authorities
for appropriate action under the Act.
6.
Remittance of payment.-- (1) The export of carpets shall not be
deemed to have been completed unless payment thereof is received in foreign
currency and goods are actually taken out of Pakistan.
(2)
The foreign currency shall be surrendered to the State Bank of Pakistan
and the supplier shall receive the payment in Pak rupees as per the prevailing
State Bank of Pakistan’s procedures and foreign exchange regulations.
(3)
In case goods supplied under these rules are not exported or remittance
is not made in the prescribed manner or within thirty days, sales tax involved
on such goods shall be recoverable from the supplier, besides legal or penal
action under the relevant provisions of the Act.
7.
Maintenance of records and audit.--(1)
The supplier shall maintain separate records showing supply of zero-rated
carpets and receipt and encashment of foreign currency received under these
rules, besides the records prescribed under the Act and rules made thereunder.
(2)
At the time of audit, the auditors shall also confirm that the records
prescribed under these rules have been maintained and that foreign currency has
been remitted in accordance with the prescribed procedure.
Annexure
[See
rule 4(3)]
RECEIPT
CUM UNDERTAKING FOR ZERO RATED SUPPLY OF HAND-KNOTTED CARPETS TO
FOREIGN NATIONALS
1.
NAME:___________________________________________________________
2.
ADDRESS:________________________________________________________
3.
TELEPHONE No.: _________________________________________________
4.
NATIONALITY: _________________________________________________
5.
PASSPORT No. OR OTHER IDENTIFICATION No.____________________
6.
CREDIT CARD No: _______________________________________________
7.
APPROX. DEPARTURE FROM PAKISTAN:___________________________
I hereby
confirm receipt of _______________ hand-knotted carpet(s) from M/s
__________________________________________________against zero-rated invoice
No.__________________________ dated _________________, against payment in
foreign currency through my credit card and undertake to take it/them out of
Pakistan on my departure.
SIGNATURE
Date:_______________
[C.No.3(29)STP/2000(Pt-I)
( FALAK SHER )
Additional
Secretary