RGST draft cleared – almost

The federation and provinces agree on major points in the draft of the Reformed General Sales Tax (RGST) bill.

ISLAMABAD: The federation and provinces have agreed on major points in the draft of the Reformed General Sales Tax (RGST) bill while the deadlock between Sindh and the federation on collection of tax from seven service categories including stock brokers, commission agents, clearing and forwarding agents, studios, shipping agents, customs agents  and courier services persisted.

A meeting to discuss and resolve this deadlock has been called on Wednesday, November 3.

Friday’s meeting, held at the Federal Board of Revenue’s headquarters and attended by provincial representatives and their lawyers, discussed at length the provinces’ reservations and remarks on the draft of the RGST bill. The draft will be finalised in a meeting before Wednesday, after which, it will be presented in the federal parliament for approval.

Meanwhile, the draft submitted by Sindh on provincial RGST was also discussed but there was no progress regarding collection of taxes on the seven aforementioned services. Sindh maintains that since the input tax adjustment on the seven services is a mere 0.1 to 1 per cent, it will not hand over the responsibility of their collection to the federation.

If an agreement is reached on Sindh’s draft, it is expected that it might be used as a blueprint for bills that would be presented in other provincial assemblies.

Published in The Express Tribune, October 30^th, 2010.