The effective date of measures introduced through some SROs is June 12. The implementation date of budgetary measures like increase in sales tax rate from 16 to 17 percent is June 13. The enforcement and legal measures of the remaining proposals contained in the budget have been proposed to be implemented from July 1 subject to approval by the National Assembly.
The FBR is legally empowered to issue notifications throughout the year without waiting for the federal budget. The same has been done prior to budget (2013-14) to enforce certain taxation measures from June 12. The measures effective from June 13 have legal backing of the provisions of the Provisional Collection of Taxes Act, 1931. Under the said Act, the government has implemented new taxation measures from June 13.
SRO.505(1)/2013 dated June 12, 2013 require all sales tax withholding agents to withhold the full amount of sales tax on purchases made from unregistered persons. This measure is effective from June 12, 2013. Through a notification, the lower rate of 2 percent sales tax has been withdrawn on finished articles such as expensive, branded or imported garments, leather bags, shoes and sports kits through amendment in SRO1125(1)/2011. This notification is effective from June 12, 2013.
The fiscal relief package has also been withdrawn from Khyber Pakhtunkhwa and Fata/Pata from June 12, 2013. Other measures have been made effective from June 13 like withdrawal of exemption on supplies made against international tenders. Sales tax has been charged on the basis of printed retail price of additional items from June 13.
The 2 percent 'further tax' on supplies to unregistered persons; additional sales tax on electricity and gas consumed by unregistered commercial and industrial consumers; substitution of zero-rating with exemption on items of SRO 549(1)/2008 and federal excise duty on oilseeds and locally produced oils has been enforced from June 13. The rationalisation of structure and rates of Federal Excise Duty on cigarettes has also been enforced from June 13, 2013. Similarly, federal excise duty @ 16 percent has been imposed on all financial services from June 13, 2013.