Pakistan sales tax calculator (18% on goods)

How sales tax in Pakistan is calculated

Section 3(1) of the **Sales Tax Act 1990**, as consolidated by the FBR to 30 June 2026, charges sales tax at **eighteen per cent** of the value of taxable supplies and imports. Section 3(1A) adds a **further tax of 4%** on a supply to a person who is not registered or not an active taxpayer, unless SRO 648(I)/2013 excludes the supply. Section 4 zero-rates exports and the goods in the Fifth Schedule; it keeps the further tax on Fifth Schedule goods, while an export goes to a buyer abroad.

So Rs100,000 of goods carries **Rs18,000** of sales tax, or Rs22,000 sold to an unregistered buyer. To take the tax out of a price, divide by 1.18. For goods the Board notifies under section 3(3A), the buyer pays the tax instead of the seller.

A manufacturer must register unless it is a **cottage industry** — no industrial gas or electricity connection, in a residential area, at most ten workers and turnover of at most **Rs8 million** a year. Failing any one test makes a manufacturer register. Importers, wholesalers, dealers, distributors, retailers liable to sales tax and exporters claiming refunds register whatever their turnover. Services (provincial sales tax), reduced Eighth Schedule rates, retail-price goods and exemptions are not covered. Estimate, not tax advice.