Running a business in Pakistan? Sales tax registration isn’t just a legal formality—it’s your gateway to business credibility, compliance, and growth. Let’s break down everything you need to know.
What is Sales Tax?
Sales tax is a consumption-based levy applied to goods and services, regulated by the Federal Board of Revenue (FBR) under the Sales Tax Act, 1990.
- Standard Rate: 15% (19.5% for telecommunications)
- Who Collects?: Manufacturers, wholesalers, retailers, and service providers
- Why It Matters: Non-compliance risks penalties and limits business opportunities
Who Must Register?
Don’t risk fines—stay ahead! Registration is mandatory for:
| Business Type | Threshold/Criteria |
|---|---|
| Manufacturers | Annual sales > PKR 10M or utilities > PKR 800K |
| Tier-1 Retailers | Chains, mall stores, or electric bills > PKR 1.2M |
| Importers/Wholesalers | All businesses moving taxable goods |
| Service Providers | Hotels, couriers, IT services |
| E-commerce Sellers | Platforms accepting digital payments |
Cottage industries and zero-rated exporters have exemptions.
4-Step Registration Process
1. Obtain NTN
Apply online via FBR’s portal or visit your local RTO/LTU.
2. Submit Sales Tax Application
Required documents:
- Business registration proof
- Bank statements
- CNIC copies of owners
3. Attach Financial Records
- New FBR rule: Include a balance sheet showing working capital.
- Monthly sales cap: 5x your working capital (higher limits need Commissioner approval).
4. Receive Certificate
Approval typically takes 15 working days.
Consequences of Non-Compliance
- Fines: Up to PKR 100,000 + 1% monthly penalty on unpaid tax
- Legal Risks: Business suspension or blacklisting
- Lost Opportunities: Large corporations avoid unregistered vendors
Why Choose EasyKarobar?
Navigating FBR procedures can be overwhelming. With EasyKarobar, you get:
- End-to-End Registration: From NTN to sales tax certificate
- Expert Guidance: Avoid common pitfalls
- Timely Filing: Never miss deadlines
- Audit Support: Stay prepared for FBR inspections
“We turned a 3-week process into a 5-day hassle-free experience for 1,200+ businesses!”
Final Thoughts
Sales tax registration is your business’s foundation for growth and compliance. With EasyKarobar, simplify the process and focus on what matters—scaling your venture!