FBR clarifies new levy imposed on refurbished second hand vehicles
ISLAMABAD: The Federal Board of Revenue (FBR) has clarified that levy imposed on refurbished second hand vehicles is restricted to 17pc of value addition and this relief is available to only registered persons in sales tax.
The FBR on Saturday issued a clarification regarding levying of 17pc sales tax on resale of used and refurbished vehicles. The FBR clarified that the existing law charged sales tax on full sale value which was harsh and excessive.
On the request of the business community, and after seeking support of major chambers of commerce of the country, a clause was added in the Finance Act to provide relief and to encourage refurbishing of second hand vehicles.
According to the statement, this relief is available to only registered persons in sales tax and is restricted to 17pc of value addition made by such players. No unregistered person can deduct or demand such sales tax from a buyer.