KARACHI – Sindh Revenue Board, through Sindh Revenue Board notification dated 5th June 2017 amended Section 8(2) of the Sindh Sales Tax on Services Act 2011 (Act XII of 2011) and Rule 42-E of the Sindh Sales Tax on Services Rules 2011 (Rules), as a consequence, effective 01-07-2017, the companies were required to pay Sales Tax on Gross amount paid to a manpower supplier.
The Employers Federation of Pakistan, being representative of Employers took the matter on behalf of its member companies, and filed a large number of constitutional petitions in the High Court of Sindh at Karachi through Mr. Zaheer Minhas, Advocate Supreme Court of Pakistan.
A division bench, comprising Mr. Justice Junaid Ghaffar and Mr. Justice Agha Faisal heard the matter on 17-11-2020 and accepted the constitutional petitions.
As a result, Sales Tax payable to SRB on manpower supply has been restored to its original position i.e. only on service charges and not the gross amount.
