SALES TAX ACT 1990

Provisions – under section 2

Here are some most important definitions of Sales Tax Act 1990, to which you have to be familiar with.

01- Tax [Section 2(34)]
“Tax”, unless the context requires otherwise, means sales tax;

02- Sales Tax [Section 2(29A)]
“sales tax” means—

‎⇒ the tax, additional tax, or default surcharge levied under this Act;

‎⇒ a fine, penalty or fee imposed or charged under this Act; and

‎⇒ any other sum payable under the provisions of this Act or the rules made thereunder.

03- Taxable Supplies [Section 2(41)]
“Taxable supply” means a supply of taxable goods made by an importer; manufacturer, wholesaler (including dealer), distributor or retailer other than a supply of goods which is exempt under section 13 and includes a supply of goods chargeable to tax at the rate of zero per cent under section 4.

04- Supply [Section 2(33)]
Supply means “A sale or other transfer of the right to dispose of goods as owner,
including such sale or transfer under a hire purchase agreement and also includes”
‎⇒  putting to private, business or non-business use of goods produced or manufactured in the course of taxable activity for purposes other than those of making a taxable supply;
‎⇒ auction or disposal of goods to satisfy a debt owed by a person;
‎⇒ possession of taxable goods held immediately before a person ceases to be a registered person; and
‎⇒ in case of manufacture of goods belonging to another person, the transfer or delivery of such goods to the owner or to a person nominated by him:

(Provided that the Federal Government, may by notification in the official Gazette, specify such other transactions which shall or shall not constitute supply.)

05- Taxable Goods [Section 2(39)]
“Taxable goods” means all goods other than those which have been exempted under section 13;

06- Goods [Section 2(12)]

“Goods” include every kind of movable property other than actionable claims, money, stocks, shares and securities;

07- Exempt Supplies [Section 2(11)]
“Exempt supply” means a supply which is exempt from tax under section 13.
[Section 2(11) of the Sales Tax Act, 1990)

08- Zero Rated Supplies [Section 2(48)]
“Zero-rated supply” means a taxable supply which is charged to tax at the rate of zero per cent under section 4.

09- Importer & Manufacturer [Section 2(17)]

Importer [Section 2(13)]
Importer is any person who imports any goods into Pakistan

Manufacturer or producer [Section 2(17)]
Manufacturer means a person who engages, whether exclusively or not, in the production or manufacture of goods whether or not the raw material of which the goods are produced or manufactured are owned by him; and shall include;

⇒ a person who by any process or operation assembles, mixes, cuts, dilutes, bottles, packages, repackages or prepares goods by any other manner;
⇒ an assignee or trustee in bankruptcy, liquidator, executor, or curator or any manufacturer or producer and any person who disposes of his assets in any fiduciary capacity; and
⇒ any person, firm or company which owns, holds, claims or uses any patent, proprietary or other right to goods being manufactured, whether in his or its name, or on his or its behalf, as the case may be, whether or not such person, firm or company sells, distributes, consigns or otherwise disposes of the goods.

Provided that for the purpose of refund under this Act, only such person shall be treated as manufacturer-cum-exporter who owns or has his own manufacturing facility to manufacture or produce the goods exported or to be exported;