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

Canonical: https://trykintsugi.com/sales-tax-guides/apac/pakistan
Published: September 22, 2026

Pakistan's standard sales tax on goods is 18%, with services taxed provincially. This guide explains federal vs. provincial registration, taxable scope, and filing obligations.

- **SaaS:** Taxable (provincial)
- **Digital Goods:** Taxable (provincial)

## Key Takeaways

Pakistan runs a split sales-tax system: the federal government taxes goods at a standard 18%, while each province taxes services separately (Sindh, Punjab, Khyber Pakhtunkhwa, Balochistan) at 13% to 16%. Any person making taxable supplies of goods registers with the FBR, while SaaS and digital services register at the provincial level where the customer is located — Punjab applies a reduced 5% to IT services and Sindh 3% to 8%. Exports are zero-rated federally; basic food staples, medicines, and educational books are exempt.

## Taxability Snapshot

## Sales Tax Rates

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.

| Rate | Applies to |
| --- | --- |
| Federal 18% | Standard rate on most goods (FBR) |
| Provincial 15–16% | Standard rate on services (e.g. Sindh 15%, Punjab 16%) |
| Reduced 5% (Punjab) / 3–8% (Sindh) | IT and IT-enabled services, including software and SaaS |
| Zero 0% | Exports (federal) |

For more detail, see our [APAC tax guides](/sales-tax-guides/apac).

#### Registration & nexus threshold

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.

#### Filing frequency & deadlines

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.

#### Exemptions

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].

#### Penalties

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.

#### Sources

- [1] [Federal Board of Revenue — Sales Tax Basics (scope and registration)](https://www.fbr.gov.pk/sales-tax-basics/51148/101149)

- [2] [Federal Board of Revenue — Sales Tax (federal goods vs provincial services)](https://www.fbr.gov.pk/sales-tax/142263/131269)

- [3] [Federal Board of Revenue — Sales Tax Act, 1990 (updated to 2025-26)](https://download1.fbr.gov.pk/Docs/202586148252375SalesTaxActupdatedupto2025-26.pdf)

- [4] [Federal Board of Revenue — Circular 01 of 2023 (standard rate raised to 18%)](https://download1.fbr.gov.pk/Docs/20232281524459451Circular01-2023SalesTaxFederalExcise.pdf)

- [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)](https://download1.fbr.gov.pk/SROs/20257302072529390SRO1366(I)2025.pdf)

- [6] [Sindh Revenue Board — Taxable Services (provincial sales tax on services)](https://www.srb.gos.pk/srb/taxable-services/)

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

#### Frequently asked questions

### What is the sales tax rate in Pakistan?

Federal sales tax on goods is 18% (FBR); provincial sales tax on services ranges 13–16% (e.g. Sindh 15%, Punjab 16%).

### What is the registration threshold?

Federally, manufacturers above PKR 10 million turnover, all importers, and Tier-1 retailers register; there is no federal threshold for foreign digital vendors, whose services fall under provincial sales tax.

### Is SaaS taxable in Pakistan?

Yes. SaaS is a service taxed provincially — Punjab charges a reduced 5% on IT/ITeS and Sindh 3–8% on opt-in; there is no federal sales tax on cross-border digital services.

### What must a non-resident digital seller do?

Pakistan has no federal non-resident sales-tax regime for digital services. Services are taxed by the provinces, so check the rules of each provincial authority (SRB, PRA, KPRA, BRA) where your customers are located.

### When are Pakistani sales-tax returns due?

FBR returns are monthly, with payment due by the 15th and the return by the 18th of the following month (nil returns still required); provincial returns are also monthly, around the 15th to 18th.

### What is the penalty for late Pakistani sales tax?

PKR 10,000 for a late return and PKR 10,000 or 5% of the tax due (whichever is higher) for late payment, plus fines for non-registration and up to 100% of tax short-paid on an incorrect return.