Sales Tax MCQs & Summary Review

Vocabulary-style flashcards covering key Pakistan Sales Tax provisions, penalties, due dates, thresholds, and regulatory definitions.

Tax Fraud Imprisonment (Sec 33(13))

Maximum imprisonment for tax fraud is up to 5 years.

Non-Integration Input Tax Allowance

In case of non-integration, only 40% input tax is allowed (60% is disallowed).

Tier-1 Non-Integration 1st Default Penalty

Penalty of Rs. 500,000.

Tier-1 Non-Integration 2nd Default Penalty

Penalty of Rs. 1,000,000 after 15 days.

Tier-1 Non-Integration 3rd Default Penalty

Penalty of Rs. 2,000,000 after next 15 days.

Tier-1 Non-Integration 4th Default Penalty

Penalty of Rs. 3,000,000, along with the potential sealing of business premises.

Normal Delay Default Surcharge Rate (Sec 34)

Higher of 12% per annum or KIBOR + 3%.

Tax Fraud Default Surcharge Rate

2% per month calculated on the tax evaded amount.

Sales Tax Payment Due Date

15th day of the next month.

Sales Tax Return Filing Due Date

18th day of the next month.

Cottage Industry Annual Turnover Limit

Annual turnover of Rs. 12 million or less.

Cottage Industry Labour Limit

10 workers or fewer.

Tier-1 Retailer Electricity Bill Threshold

Annual electricity bill exceeding Rs. 1,200,000.

Integrated Tier-1 Retailer Input Tax Allowance

Allowed input tax adjustment of up to 95%.

Section 73 Banking Channel Threshold

Transactions exceeding Rs. 50,000 (in aggregate per supplier per tax period) require payment through banking channel.

Section 73 Credit Purchase Payment Limit

Payment for credit purchase must be made within 180 days from the tax invoice date.

General 90% Input Restriction

Registered person can adjust input tax up to a maximum of 90% of output tax for that tax period.

E-Bilty

A digital transport document linked to a tax invoice.

Cargo Tracking System (CTS) Legislation

Introduced through the Finance Act, 2025.

Best Judgment Assessment Abatement Period

The order abates if return, tax, penalty, and surcharge are paid within 60 days.