Pakistan Sales Tax

---
name: pakistan-sales-tax
description: "Use this skill whenever asked to prepare, review, or classify transactions for a Pakistan Sales Tax return (federal or provincial) for any client. Trigger on phrases like \"Pakistan sales tax\", \"FBR return\", \"IRIS portal\", \"Sindh sales tax\", \"Punjab sales tax\", or any request involving Pakistan sales tax. MUST be loaded alongside vat-workflow-base v0.1 or later. ALWAYS read this skill before touching any Pakistan sales tax work."
license: "AGPL-3.0-or-later (code) / OpenAccountants Guide License v1.0 (content)"
metadata:
  source: openaccountants
  openaccountants_url: "https://www.openaccountants.com/skills/pakistan-sales-tax"
  jurisdiction: "PK"
  tax_year: "2025"
  last_updated: "2026-07-13"
---

# Pakistan Sales Tax

## Section 1 — Quick reference

**Quick reference table**

| Field | Value |
| --- | --- |
| Country | Pakistan (Islamic Republic of Pakistan) |
| Federal Sales Tax rate (goods) | 18% (standard); 25% (luxury/sin goods); reduced rates via SRO |
| Provincial Sales Tax rate (services) | Varies: Sindh 13%, Punjab 16%, KP 15%, Balochistan 15% |
| Zero rate | 0% (exports, certain essential goods via SRO) |
| Exempt | Basic food (unprocessed), education, healthcare, financial services |
| Return form | Federal: monthly via IRIS; Provincial: via respective portals |
| Filing portal | https://iris.fbr.gov.pk (IRIS — federal); SRB/PRA/KPRA/BRA portals (provincial) |
| Authority | Federal Board of Revenue (FBR) — goods; SRB/PRA/KPRA/BRA — services |
| Currency | PKR (Pakistani Rupee) |
| Filing frequency | Monthly (federal and most provincial) |
| Deadline | Federal: 18th of following month; Provincial: varies (typically 15th-18th) |
| Companion skill | vat-workflow-base v0.1 or later — MUST be loaded |

- **Federal/provincial split** — Pakistan has SPLIT federal/provincial sales tax. Federal covers goods (FBR). Provincial covers services (SRB for Sindh, PRA for Punjab, KPRA for KP, BRA for Balochistan). A single business may file BOTH.

**Conservative defaults**

| Ambiguity | Default |
| --- | --- |
| Unknown rate on goods | 18% (federal) |
| Unknown rate on services | Apply province rate based on client location |
| Unknown input tax status | Not deductible |
| Unknown counterparty location | Domestic Pakistan |
| Unknown business-use proportion | 0% recovery |

## Section 2 — Required inputs and refusal catalogue

### Required inputs

- **Minimum viable inputs** — Minimum viable — bank statement for the month. Acceptable from: HBL (Habib Bank), UBL (United Bank), MCB (Muslim Commercial Bank), Allied Bank, Bank Alfalah, Meezan Bank, Standard Chartered PK, or any other. JazzCash and Easypaisa statements also accepted.
- **Recommended inputs** — Recommended — sales invoices, purchase invoices with supplier NTN/STRN, client's NTN and STRN.

### Pakistan-specific refusal catalogue

- **R-PK-1 — Provincial service tax complexity** — Trigger: client provides services in multiple provinces. Message: "Multi-province service tax filing requires separate returns to each provincial authority. Please escalate for province-by-province analysis."  _(R-PK-1)_
- **R-PK-2 — Manufacturing under SRO regime** — Trigger: client is a manufacturer with SRO-based reduced rates or exemptions. Message: "SRO-based manufacturing exemptions require gazette-level verification. Please escalate."  _(R-PK-2)_
- **R-PK-3 — Withholding agent (sales tax)** — Trigger: client is a designated withholding agent for sales tax. Message: "Withholding agent obligations require tracking of certificates and deposits. Please escalate."  _(R-PK-3)_
- **R-PK-4 — Export-oriented units (EOU)** — Trigger: client in export-oriented unit with zero-rating facility. Message: "EOU zero-rating requires SRO-level verification. Please escalate."  _(R-PK-4)_

## Section 3 — Supplier pattern library

### 3.1 Pakistani banks (fees — check)

**Pakistani banks pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| HBL, HABIB BANK | EXCLUDE for bank charges | Financial service (provincial ST may apply) |
| UBL, UNITED BANK | EXCLUDE for bank charges | Same |
| MCB, MUSLIM COMMERCIAL | EXCLUDE for bank charges | Same |
| ALLIED BANK, BANK ALFALAH | EXCLUDE for bank charges | Same |
| MEEZAN BANK | EXCLUDE for bank charges | Same |
| STANDARD CHARTERED PK | EXCLUDE for bank charges | Same |
| INTEREST, LOAN, REPAYMENT | EXCLUDE | Out of scope |

### 3.2 Mobile financial services

**Mobile financial services pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| JAZZCASH, JAZZ CASH | EXCLUDE for transaction fees | Financial service |
| EASYPAISA, EASY PAISA | EXCLUDE for transaction fees | Same |
| NAYAPAY, SADAPAY | EXCLUDE for transaction fees | Same |

### 3.3 Government (exclude)

**Government pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| FBR, FEDERAL BOARD OF REVENUE | EXCLUDE | Tax payment |
| CUSTOMS, PAKISTAN CUSTOMS | EXCLUDE | Duty |
| SRB, SINDH REVENUE, PRA, PUNJAB REVENUE | EXCLUDE | Provincial tax payment |
| EOBI, SOCIAL SECURITY | EXCLUDE | Social security |
| SECP | EXCLUDE | Registration fee |

### 3.4 Utilities

**Utilities pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| K-ELECTRIC, KESC, LESCO, FESCO, IESCO | Domestic 18% (federal ST on electricity) | Electricity |
| SSGC, SNGPL | Domestic 18% | Gas |
| PTCL, JAZZ, ZONG, TELENOR, UFONE | Provincial service tax applies | Telecoms |

### 3.5 SaaS and international services

**SaaS and international services pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| GOOGLE, MICROSOFT, META, AWS | Self-assess (federal 18% on digital goods; provincial on services) | Non-resident |
| ZOOM, SLACK, CANVA, FIGMA | Self-assess | Same |

### 3.6 Professional services

**Professional services pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| AUDIT, CA FIRM, ACCOUNTING | Provincial service tax | Check province |
| LAW FIRM, ADVOCATE | Provincial service tax | Same |
| CONSULTANT, ENGINEERING | Provincial service tax | Same |

### 3.7 Payroll and exclusions

**Payroll and exclusions pattern table**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| SALARY, WAGES, TANKHWAH | EXCLUDE | Outside sales tax scope |
| OWN TRANSFER, INTERNAL | EXCLUDE | Internal |
| CASH WITHDRAWAL, ATM | TIER 2 — ask | Default exclude |

## Section 4 — Worked examples

### Example 1 — Federal sales tax on goods at 18%

**Input line:** `05.04.2026 ; DOMESTIC BUYER LTD ; CREDIT ; Invoice PK-041 manufactured goods ; PKR 1,180,000`

**Reasoning:** Manufacturer selling taxable goods. Federal 18%. Net = PKR 1,000,000, ST = PKR 180,000.

**Example 1 worked table**  _(FBR)_

| Date | Counterparty | Gross | Net | Tax | Rate | Authority | Default? | Excluded? |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 05.04.2026 | DOMESTIC BUYER | +1,180,000 | +1,000,000 | 180,000 | 18% | FBR | N | — |

### Example 2 — Provincial service tax (Sindh 13%)

**Input line:** `10.04.2026 ; CLIENT CO ; CREDIT ; Consulting fee ; PKR 226,000`

**Reasoning:** Service in Sindh. SRB 13%. Net = PKR 200,000, Tax = PKR 26,000.

**Example 2 worked table**  _(SRB)_

| Date | Counterparty | Gross | Net | Tax | Rate | Authority | Default? | Excluded? |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 10.04.2026 | CLIENT CO | +226,000 | +200,000 | 26,000 | 13% | SRB | N | — |

### Example 3 — Export, zero-rated

**Input line:** `15.04.2026 ; US IMPORTER INC ; CREDIT ; Textile export ; PKR 5,000,000`

**Example 3 worked table**  _(FBR)_

| Date | Counterparty | Gross | Net | Tax | Rate | Authority | Default? | Excluded? |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 15.04.2026 | US IMPORTER INC | +5,000,000 | +5,000,000 | 0 | 0% | FBR | N | — |

### Example 4 — Non-resident digital service

**Input line:** `18.04.2026 ; GOOGLE CLOUD ; DEBIT ; Cloud April ; PKR -50,000`

**Reasoning:** Non-resident digital service. Self-assess federal 18%. Input credit if for taxable supplies.

**Example 4 worked table**  _(FBR)_

| Date | Counterparty | Gross | Net | Tax | Rate | Authority | Default? | Excluded? |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 18.04.2026 | GOOGLE CLOUD | -50,000 | -50,000 | 9,000 | 18% | FBR | N | — |

### Example 5 — JazzCash transfer fee

**Input line:** `25.04.2026 ; JAZZCASH ; DEBIT ; Transfer fee ; PKR -50`

**Example 5 worked table**  _(—)_

| Date | Counterparty | Gross | Net | Tax | Rate | Authority | Default? | Excluded? |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 25.04.2026 | JAZZCASH | -50 | — | — | — | — | N | "Financial service" |

## Section 5 — Tier 1 classification rules (compressed)

### 5.1 Federal sales tax on goods — 18% standard. Manufacturers, importers, and specified retailers.

- **Federal sales tax on goods** — 18% standard. Manufacturers, importers, and specified retailers.

### 5.2 Provincial service tax — Varies by province (Sindh 13%, Punjab 16%, KP 15%, Balochistan 15%).

- **Provincial service tax** — Varies by province (Sindh 13%, Punjab 16%, KP 15%, Balochistan 15%).

### 5.3 Zero rate — Exports (federal). Input tax credit available.

- **Zero rate** — Exports (federal). Input tax credit available.

### 5.4 Exempt — Basic food (unprocessed), education, healthcare.

- **Exempt** — Basic food (unprocessed), education, healthcare.

### 5.5 Input tax credit — Federal: available on goods. Provincial: varies. Valid invoice with NTN/STRN required.

- **Input tax credit** — Federal: available on goods. Provincial: varies. Valid invoice with NTN/STRN required.

### 5.6 Blocked input — Personal consumption, entertainment, passenger vehicles.

- **Blocked input** — Personal consumption, entertainment, passenger vehicles.

### 5.7 Imports — Federal sales tax at customs. Provincial not applicable at import.

- **Imports** — Federal sales tax at customs. Provincial not applicable at import.

### 5.8 Reverse charge — Non-resident services: self-assess.

- **Reverse charge** — Non-resident services: self-assess.

### 5.9 Withholding — Designated agents withhold sales tax at prescribed rates.

- **Withholding** — Designated agents withhold sales tax at prescribed rates.

### 5.10 Further tax / extra tax — Additional levies on sales to unregistered persons.

- **Further tax / extra tax** — Additional levies on sales to unregistered persons.

## Section 6 — Tier 2 catalogue (compressed)

### 6.1 Federal vs provincial split — Default: flag. Question: "Is this goods (FBR) or services (provincial)?"

- **Federal vs provincial split** — Default: flag. Question: "Is this goods (FBR) or services (provincial)?"

### 6.2 Province identification — Default: client's registered province. Question: "Which province is the service provided in?"

- **Province identification** — Default: client's registered province. Question: "Which province is the service provided in?"

### 6.3 SaaS entities — Default: self-assess federal 18%. Question: "Goods or services? Check invoice."

- **SaaS entities** — Default: self-assess federal 18%. Question: "Goods or services? Check invoice."

### 6.4 Cash withdrawals — Default: exclude.

- **Cash withdrawals** — Default: exclude.

### 6.5 JazzCash/Easypaisa transactions — Default: classify underlying transaction, not payment method.

- **JazzCash/Easypaisa transactions** — Default: classify underlying transaction, not payment method.

## Section 7 — Excel working paper template

Per vat-workflow-base Section 3, with Pakistan fields: Federal output 18%, Zero-rated, Exempt, Federal input, Provincial output (by province), Provincial input, Net payable (federal), Net payable (provincial).

## Section 8 — Bank statement reading guide

HBL, UBL, MCB exports CSV. PKR primary. JazzCash/Easypaisa exports also usable. Urdu descriptions possible. Internal transfers: exclude. Convert foreign currency at SBP rate.

## Section 9 — Onboarding fallback

### 9.1 NTN/STRN — "What is your FBR NTN? Provincial STRN?"

- **NTN/STRN question** — "What is your FBR NTN? Provincial STRN?"

### 9.2 Province — "Where is the business registered?"

- **Province question** — "Where is the business registered?"

### 9.3 Registration type — "Federal (goods), provincial (services), or both?"

- **Registration type question** — "Federal (goods), provincial (services), or both?"

### 9.4 Filing period — Monthly. "Which month?"

- **Filing period question** — Monthly. "Which month?"

### 9.5 Exports — "Do you export?"

- **Exports question** — "Do you export?"

### 9.6 Credit brought forward — Always ask.

- **Credit brought forward** — Always ask.

## Section 10 — Reference material

### Sources

1. Sales Tax Act 1990 (federal, as amended). 2. Provincial sales tax acts (Sindh, Punjab, KP, Balochistan). 3. FBR IRIS portal. 4. SROs for exemptions and reduced rates.

### Known gaps

1. Multi-province filing refused. 2. SRO-based manufacturing exemptions refused. 3. Withholding agent obligations refused. 4. Provincial rate changes frequent — verify before filing.

### Change log

- v2.0 (April 2026): Full rewrite to Malta v2.0 ten-section structure. Federal/provincial split emphasized.

## Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. All outputs must be reviewed by a qualified professional before filing.

The most up-to-date version is maintained at [openaccountants.com](https://openaccountants.com).

## Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon.

## Today's figures and who stands behind this skill

This file is an AI skill (tax rules your AI follows) from OpenAccountants, copied on 2026-07-13. Rates, thresholds and deadlines change. For the current version of this skill, its official sources and the named accountant (if any) who stands behind it, call `get_skill` with slug `pakistan-sales-tax` on the OpenAccountants connector (https://www.openaccountants.com/connect), or read https://www.openaccountants.com/skills/pakistan-sales-tax. If neither is available, confirm every figure against the official source pages cited above before relying on it.