Pakistan Sales Tax Guide for 2026: Rates, Registration & Compliance

Pakistan runs a split sales-tax system. The federal government (FBR) taxes the sale and import of goods at a standard 18% under the Sales Tax Act 1990, while each province taxes services through its own authority — Sindh (SRB), Punjab (PRA), Khyber Pakhtunkhwa (KPRA), and Balochistan (BRA) — at 13% to 16%. Because SaaS and digital services are services, they are taxed provincially, with several provinces applying reduced IT rates.

For more detail, see our APAC tax guides.

Pakistan uses sales-tax registration rules, not US-style economic nexus, and splits the tax between the federal and provincial levels. The Federal Board of Revenue (FBR) taxes goods under the Sales Tax Act 1990, and any person making taxable supplies of goods must register with the FBR [1][2]. Sales tax on services is levied separately by each province, such as the Sindh Revenue Board and Punjab Revenue Authority, which have their own registration rules [2][6]. Pakistan has no single national non-resident VAT regime; digital services consumed in a province are taxed by that province, and payment intermediaries and marketplaces are increasingly required to collect tax on foreign digital vendors' sales [3]. Registration steps are in the How to Register section.

Federal FBR sales-tax returns are filed monthly through the IRIS portal, with payment due by the 15th and the return by the 18th of the following month, with a nil return still required. Provincial authorities also require monthly returns, with due dates around the 15th to 18th.

Exports are zero-rated federally, and basic food staples, medicines, and educational books are exempt. SaaS and digital services are taxed as services at the provincial level — Punjab applies a reduced 5% to IT and IT-enabled services and Sindh 3% to 8% on opt-in. Non-resident suppliers of digital services register with the province where their customers are located rather than paying any federal charge [5].

Failure to register draws a penalty of PKR 10,000 or 5% of the tax involved, whichever is higher. Late filing costs PKR 10,000 (PKR 200 per day if filed within 10 days), and late payment PKR 10,000 or 5% of the tax due, whichever is higher, and an incorrect return can cost up to 100% of the tax short-paid.

• [1] Federal Board of Revenue — Sales Tax Basics (scope and registration)

• [2] Federal Board of Revenue — Sales Tax (federal goods vs provincial services)

• [3] Federal Board of Revenue — Sales Tax Act, 1990 (updated to 2025-26)

• [4] Federal Board of Revenue — Circular 01 of 2023 (standard rate raised to 18%)

• [5] Federal Board of Revenue — S.R.O. 1366(I)/2025 (Digital Presence Proceeds Tax withdrawn on foreign-supplied goods and services, 30 July 2025)

• [6] Sindh Revenue Board — Taxable Services (provincial sales tax on services)

Verified July 2026 against Federal Board of Revenue and provincial revenue authority guidance.