Suppliers paying 15% value added tax don't have to pay additional source VAT: NBR
If a supplier of goods or services pays value-added tax (VAT) at the rate of 15% at the time of supply of goods, they will not have to pay additional source VAT, said the National Board of Revenue (NBR).
The NBR issued an order in this regard on Wednesday (26 October).
However, according to the order, only those who pay VAT at the rate of 15% and submit regular VAT returns will get this benefit.
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The move will help companies to reduce their working capital shortfall, the NBR added.
A senior officer of NBR's VAT department told Business Standard that even though the supplier companies had deducted source VAT, there was an opportunity to get a refund. But as the process of getting a refund was not easy, a huge amount of money would get stuck int he process. As a result of this new order, companies will no longer have to deposit that amount.
