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Pakistan cuts Sales Tax threshold

Federal Bureau of Revenue brings many more business into tax net

Pakistan is set to reduce the annual threshold above which businesses must register for Sales Tax. The new limit will be PKR 8m (approx $45k or €40k) per annum, up from PKR 10 million.

Once a business exceeds this threshold, it must apply for a registration from the Federal Bureau of Revenue. A voluntary registration is allowed by application to provincial tax offices.  Non-resident businesses generally are not required to register for Sales Tax. The supply of digital/online services may trigger the requirements. The current Sales Tax rate in Pakistan for most goods is 17%.  The rate for services varies between 1% and 12%.

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