C.No. 3(16)ST&FE-Policy/2022/230285-R, Islamabad, the 14th November, 2022

SROS: C.No. 3(16)ST&FE-Policy/2022/230285-R, Islamabad, the 14th November, 2022 IMPOSITION OF 1% SALES TAX ON PHARMA MANUFACTURERS: CLARIFICATION REGARDING Government of Pakistan Revenue Division Federal Board of Revenue Inland Revenue ***** C.No. 3(16)ST FE-Policy/2022/230285-R Islamabad, the 14th November, 2022 Subject: IMPOSITION OF 1% SALES TAX ON PHARMA MANUFACTURERS: CLARIFICATION REGARDING I am directed to refer your letter No. NIL dated 13-10-2022 on the subject cited above. 2. The content of the letter has been examined and FBR views/comments are given as under:- S# Issue Remarks 1 What rate of tax should be charged from unregistered persons as most of the retailers/ distributors are non registered? 1%+ 3% further tax As per Sr. No 81 of table-I of the Eighth schedule to Sales Tax Act, 1990 manufacture or import of substances registered as drugs under the Drugs Act, 1976 (XXXI of 1976) shall charge sales tax @1% Subject to the conditions that: (i) Tax charged and deposited by the manufacturer or importer, as the case may be, shall be final discharge of tax in the supply chain (ii) No input tax shall be adjusted by the manufacturer or importer. Moreover, as per section 3(IA) of the said act further tax @ 3% shall be charged, levied and paid where taxable supplies are…