The Federal Revenue Council (FBR) expanded the scope of suspension of sales tax registration under recently amended sales tax rules for the year 2006. The reviews provide clearer conditions according to which the registered companies may face the status of their sales tax.
According to the revised rules, FBR now has the authority to suspend companies if they refuse to reach the inspection places as shown in the 40 B and 40 EGP sales tax law. Likewise, companies that fail to provide the required records under Articles 25 and 37 are subject to comment.
Other reasons for suspending cases of non -proportional commercial activity include, as the company’s rotation rate exceeds five times the total capital and declared litigants.
Transactions with individuals, suspended companies, purchases or sales that exceed 10 % of the total business or 50 million rupees, whichever is higher, also leads to suspension.
The non -sales tax declarations are for a period of three consecutive months or the provision of zero -safer revenues for a period of six consecutive months are additional criteria for suspension, as well as participation in tax fraud activities, specified under Article 2 (37) of the Sales Tax Law.
Once the suspension is imposed, the companies are 30 days to respond to the notification, after which the suspension may be canceled depending on the taxpayer response.
