FBR Revises Sales Tax Rules for Specified Goods

The Federal Board of Revenue (FBR) has amended the sales tax framework applicable to certain locally supplied and imported goods, issuing a corrigendum to clarify how their value should be determined and how sales tax is to be collected under Serial No. 65 of the Third Schedule to the Sales Tax Act, 1990.

Through Sales Tax General Order No. 19 of 2026, the FBR clarified that manufacturers making local supplies will be required to calculate sales tax on the value of supply determined under Section 2(46) of the Sales Tax Act.

For imported goods falling within Serial No. 65, the tax will instead be calculated and recovered on a value equal to 130% of the amount determined under Section 25 of the Customs Act, 1969. This valuation will include the applicable customs duties and Federal Excise Duty.

The amended framework applies to five specified categories. These include footwear sold by registered manufacturers through their own digitally integrated, FBR-compliant point-of-sale retail outlets. It also covers supplies made by importers to registered manufacturers and retailers whose businesses are digitally integrated and POS compliant.

The rules further apply where such digitally integrated retailers directly import goods for onward sale to final consumers.

Another category covers goods supplied by digitally integrated manufacturers or registered importers to corporate organisations, federal or provincial government departments, autonomous institutions and statutory bodies purchasing products for their own use.

The revised provisions also include manufacturers whose business is exclusively focused on supplying goods to FBR digitally integrated and POS-compliant retailers.

According to the FBR, the corrigendum has been issued to eliminate uncertainty and promote consistent application of the sales tax rules. The authority has withdrawn the previous Annexure-A attached to the general order and replaced it with an updated version governing the assessment, levy and collection of sales tax on goods covered by Serial No. 65.

The amendments will apply retrospectively from July 1, 2026. All other provisions contained in the earlier Sales Tax General Order will continue to remain in force.