Are you a SST registered manufacturer? Do you know that you are liable to be exempted from payment of tax on raw materials you acquired for your manufacturing processes?
This is due to our government's effort in ensuring SST is a single layer tax system, all registered manufacturer of taxable goods can be exempted from payment of tax when acquiring materials for their manufacturing processes. However, this exemption does not come automatically, you will need to apply for the exemption online.
This blog is divided into 2 parts: 1) information on tax exemption, 2) application for tax exemption.
Who are exempted from Sales tax?
There are 3 types of pesonnel that are liable for sales tax exemption in extemption listed of Sales Tax Act 2018.
- Schedule A: Classification of the person, i.e. Duty Free Shop, Inland Clearance Depot, Local Authority, Federal of State Government Department, Ruler of States and etc, are exempted from Sales Tax.
- Schedule B: This list includes manufacturer of non-taxable items. Such manufacturer are exempted on paying Sales Tax on the acquisition of components, raw materials used for their manufacturing processes.
- Schedule C: This includes SST registered manufacturer (Manufactrer of taxable items). Manufacturer under this schedule can be exempted from payment of Sales Tax when acquiring raw materials and components for manufacturing their taxable items.
For those listed under these 3 schedules, you can apply by your getting exemption application form from the custom's official SST website. Please note that there are different forms for each type of purchase (e.g. local or import purchase, schedule types and etc).
Visit our next blog post "Manufacturer who are exempted from Sales Tax. (Part 2)" to know more about how to apply the Sales Tax exemption if you are eligible to do so.
You can visit the links below to read more on SST related topics in TreezSoft:
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