Human Rights Minister Dr Shireen Mazari on Wednesday rebuffed the impression that the Federal Board of Revenue (FBR) has made it mandatory for women to furnish the CNIC of their husband or father while making a purchase of over Rs50,000 from a registered sales tax seller, a private media house reported.
The minister’s statement, which followed a conversation she had with the Federal Board of Revenue (FBR) chairman, came in response to a tweet condemning the alleged condition of women needing to present their husband or father’s ID to conduct transactions above Rs50,000.
“Absolutely wrong — so spoke to FBR Chairman & he said this was a ‘concession’ only for women who don’t want to give their own CNIC card’s copy fearing misuse/abuse,” she wrote in reply to the tweet. She clarified that women did not need to provide a copy of their husband/father’s CNIC in addition to their own.
The CNIC condition had been announced by the FBR through a sales tax circular that was issued to explain the amendments made in the Sales Tax Act in the budget for 2019-20.
It is further clarified that the FBR has only sought the CNIC number from buyers, not a copy of the card itself.
The last point in the circular read: “FBR is fully conversant of cultural constraints and traditions of the country. Therefore, in case of purchase above Rs50,000 by an ordinary consumer being a ‘female’, the CNIC of the husband or the father will be considered valid for the purposes of implementation of this provision.”
As per the provisions notified by the FBR on Monday, it will be mandatory for ordinary citizens to show their identity cards while making a purchase of over Rs50,000 from a ‘sales tax registered person’. This would mean that any citizen who shops for over Rs50,000, at a shopping mall for example, will have to present their CNIC if the business they are purchasing from is registered.
At present, there are only 41,484 sales tax registered persons in the country who are paying some tax with their returns, according to the FBR.
The provision of CNIC number does not require the buyer to be a registered person under the sales tax law, and sales to unregistered persons are also permitted.
The law provides that this condition will not apply if the value of purchases is below Rs50,000 in case the sale is being made to an ‘ordinary consumer’ — defined as a person who buys something for personal consumption.
The main purpose of the CNIC number condition, as stated by the FBR, is the documentation of business-to-business transactions and a few transactions of a value higher than Rs50,000 by a limited number of consumers. The provision will help avoid unverifiable and fictitious business buyers from conducting transactions that result in huge sales tax losses in the value chain, the FBR claimed.
In Pakistan, ordinary small and medium-sized retailers fall outside the sales tax regime. Therefore, sales by such persons will not be affected by this provision in any manner.