Value Added Tax and Supplementary Duty Rules, 2016

Chapter I: Preliminary

1. Short Title and Commencement

(1) These rules shall be called the Value Added Tax and Supplementary Duty Rules, 2016.
(2) Chapter II and relevant definitions of Chapter I shall come into force immediately.
(3) Other chapters shall come into force on such dates as the Board may, by notification in the official Gazette, appoint.

2. Definitions

Unless there is anything repugnant in the subject or context, in these rules:

• "Act" means the Value Added Tax and Supplementary Duty Act, 2012 (Act No. 47 of 2012).
• "Import value" means the value determined under Section 25 and 25A of the Customs Act, 1969 (IV of 1969).
• "Turnover tax certificate" means a certificate issued by the Commissioner under Section 10(2) or Section 12 in favor of a listed person.
• "Listed person" means a person listed under Section 10 of the Act.
• "Related persons" means two registered or listed persons having not less than 50% common ownership.
• "Representative" means any person nominated by a registered or listed person to perform any act under the Act.
• "Form" means any form appended to these rules.
• "Bonded warehouse" and "Special bonded warehouse" mean warehouses as defined in Chapter XI of the Customs Act, 1969.
• "Supply under barter process" means a supply conducted between related persons in exchange of goods or services.
• "Bill of export" means a bill of export submitted under Section 131 of the Customs Act, 1969.
• "Board" means the National Board of Revenue established under the National Board of Revenue Order, 1972 (President Order No. 76 of 1972).
• "Bank account" means an account operated with any bank by a registered or listed person and informed to the Commissioner.
• "VAT agent" means a person authorized by a non-resident person to act on his behalf with VAT authorities.
• "VAT registration certificate" means a certificate issued by the Commissioner under Section 6(2), Section 8(2), or Section 12.

Chapter II: VAT Registration and Turnover Tax Listing

3. Threshold for Registration or Listing

The registration or listing threshold of a person shall be determined by considering the aggregate economic activities of all its branches or units.

4. Application for Registration

A person liable to be registered shall apply within 15 days from the date liability arises, in Form VAT-2.1 for central registration or VAT-2.2 for branch registration, to the concerned Commissioner. Applications may be submitted:

• Online via the VAT Online System;
• At a Customs, Excise & VAT Commissionerate or divisional office;
• At a service center designated by the Board;
• At a fair managed by the Board; or
• At any other place as determined by the Board.

The Commissioner, upon verification, shall issue a VAT registration certificate (Form VAT-2.3) containing a Business Identification Number within three working days.

5. Application for Turnover Tax Listing

A person fulfilling conditions under Section 10(1) shall apply using Form VAT-2.1 to the concerned Commissioner. The Commissioner shall, upon verification, issue a turnover tax certificate (Form VAT-2.3) within three working days.

6. Voluntary Registration

A person may apply for voluntary registration under Section 8(1) of the Act. Such a person shall pay tax from the beginning of the next tax period and maintain records as prescribed in Rule 95.

7. Suo Motu Registration by Commissioner

The Commissioner may register or list a person suo motu if liable under Section 12, based on available information, and issue a certificate with effect from the date liability arose.

8. Cancellation of VAT Registration

A registered person may apply in Form VAT-2.4 for cancellation if:

• Business did not commence after registration;
• Business has been discontinued;
• Business activity became exempt;
• Annual turnover remains below registration threshold for two consecutive years.

Upon verification and submission of a final return (Form VAT-2.5), the Commissioner may cancel the registration.