WHT Manual

PREFACE
This manual is intended to act as a single source of useful information on account of transactions subject to
Withholding / Advance Tax under the Income Tax Ordinance, 2001.
This manual contains link to the information available in the Income Tax Ordinance, 2001; the Income Tax Rules,
2002; relevant Notifications and Circulars. The document is subdivided in the following parts:
 Sections of Income Tax Ordinance, 2001 relevant to Withholding / Advance Tax.

 Applicable rates as prescribed in the Income Tax Ordinance, 2001 alongwith other relevant information
like rates, responsible withholding agent and identification of transaction as adjustable / minimum /
final discharge of tax liability.
 Exemptions, Rate reductions & Clarifications available in the Ordinance, Rules, Notifications & Circulars.
DISCLAIMER
Although the information contained in this manual is believed to be accurate and updated, while every care has
been taken in compiling this manual, Softax takes no responsibility, makes no representations and gives no
warranties of whatever nature in respect of this manual, including but not limited to the accuracy or
completeness of any information contained therein.
We always depend on your assistance and feedback and request to please inform us if find any mistake or
omission through email at care@softax.com.pk
Updated: Finance Act, 2021.

Softax (Private) Limited
www.softax.com.pk
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Contents
WITHHOLDING TAX UNDER INCOME TAX LAW...................................................................................................7
TIME OF DEDUCTION OF TAX.............................................................................................................................7
Section 158 - Time of deduction of tax ......................................................................................................................... 7
Rule 43B - Amount actually paid under section 158 ....................................................................................................... 7
PAYMENT OF TAX COLLECTED OR DEDUCTED ....................................................................................................8
Section 160 - Payment of tax collected or deducted ...................................................................................................... 8
Rule 43 - Payment of tax collected or deducted ............................................................................................................. 8
CERTIFICATE OF COLLECTION OR DEDUCTION OF TAX ........................................................................................9
Section 164 - Certificate of collection or deduction of tax ............................................................................................. 9
Rule 42 - Certificate of collection or deduction of tax.................................................................................................... 9
WITHHOLDING TAX STATEMENT UNDER INCOME TAX LAW ............................................................................. 10
Section 165 - Statements ............................................................................................................................................. 10
Rule 44 - Statement of tax collected or deducted......................................................................................................... 11
RECOVERY OF TAX .......................................................................................................................................... 12
Section 161 - Failure to pay tax collected or deducted ................................................................................................ 12
Section 162 - Recovery of tax from the person from whom tax was not collected or deducted ..................................... 12
Section 163 - Recovery of tax from the person from whom tax was not collected or deducted ..................................... 13
RELEVANT PENALTIES...................................................................................................................................... 14
Section 182 - Offences and penalties .......................................................................................................................... 14
EXEMPTION OR LOWER RATE CERTIFICATE ...................................................................................................... 16
Section 159 - Exemption or lower rate certificate ........................................................................................................ 16
Rule 40 - Exemption or lower rate certificate u/s 159 ................................................................................................. 16
PROVISIONS RELATING TO PERSONS NOT APPEARING IN ACTIVE TAXPAYERS' LIST ........................................... 17
Section 100BA - Special provisions relating to persons not appearing in active taxpayers' list ..................................... 17
RULES FOR PERSONS NOT APPEARING IN THE ACTIVE TAXPAYERS' LIST ................................................................ 17
TRANSACTIONS SUBJECT TO WITHHOLDING TAX UNDER INCOME TAX LAW ..................................................... 20
Section 148 - Imports .................................................................................................................................................. 21
Section 149 - Salary ................................................................................................................................................... 37
Section 5 - Tax on dividends ........................................................................................................................................ 39
Section 150 - Dividends............................................................................................................................................... 39
Section 7B - Tax on profit on debt ............................................................................................................................... 42
Section 151 - Profit on debt ........................................................................................................................................ 43
Section 6 - Tax on certain payments to non-residents ................................................................................................... 48
Section 152 - Payments to non-residents ...................................................................................................................... 49
Section 153 - Payments for goods, services and contracts ........................................................................................... 58
Section 154 - Exports .................................................................................................................................................. 69
Section 154A - Export of Services ............................................................................................................................... 74
Section 155 - [Rent of immoveable] property .............................................................................................................. 76
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Section 156 - Prizes and winnings ............................................................................................................................... 78
Section 156A - Petroleum Products.............................................................................................................................. 79
Section 231B - Advance tax on private motor vehicles ................................................................................................ 82
Section 233 - Brokerage and commission .................................................................................................................... 85
Section 234 - Tax on motor vehicles ............................................................................................................................ 89
Section 235 - Electricity consumption ........................................................................................................................... 92
Section 236 - Telephone and internet users .................................................................................................................. 97
Section 236A - Advance tax at the time of sale by auction .......................................................................................... 98
Section 236C - Advance Tax on sale or transfer of immovable property ................................................................... 100
Section 236G - Advance tax on sales to distributors, dealers and wholesalers ........................................................... 104
Section 236H - Advance tax on sales to retailers ....................................................................................................... 104
Section 236I - Collection of advance tax by education institutions ............................................................................. 107
Section 236K - Advance tax on purchase or transfer of immovable property ............................................................. 108
Section 236O - Advance tax under this chapter......................................................................................................... 111
Section 236Q - Payment to residents for use of machinery and equipment ................................................................. 112
THE ELEVENTH SCHEDULE OF THE SALES TAX ACT, 1990 ................................................................................. 117
Table 117
CHAPTER XIV-D OF THE SALES TAX RULES, 2006 ............................................................................................. 119
WITHHOLDING OF SALES TAX BY THE RECIPIENT OF SUPPLY .................................................................................. 119
150ZZH. Application. .............................................................................................................................................. 119
150ZZI. Responsibility of a withholding agent. .................................................................................................... 119
150ZZJ. Responsibility of the registered supplier. ................................................................................................ 120
150ZZK. Responsibility of the Commissioner. ....................................................................................................... 121
SINDH SALES TAX SPECIAL PROCEDURE (WITHHOLDING) RULES, 2014 ............................................................ 122
1. Short title, application and commencement. .......................................................................................... 122
2. Definitions................................................................................................................................................ 123
3. Responsibility of a withholding agent. .................................................................................................... 124
4. Responsibility of the registered service provider. ................................................................................... 127
5. Application of other provisions. .............................................................................................................. 128
6. Forms prescribed for withholding agents................................................................................................ 128
7. Repeal. ..................................................................................................................................................... 128
PUNJAB SALES TAX ON SERVICES (WITHHOLDING) RULES, 2015 ..................................................................... 135
1. Short title and commencement............................................................................................................... 135
2. Definitions................................................................................................................................................ 135
3. Applicability. ............................................................................................................................................ 136
5. Withholding from registered service providers....................................................................................... 136
6. Withholding from unregistered person. .................................................................................................. 136
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7. Deduction of tax on advertisement services. .......................................................................................... 136
8. Procedure. ............................................................................................................................................... 137
9. Filing of statement. .................................................................................................................................. 138
10. Provision of information or date. ............................................................................................................ 138
11. Certificate of withholding tax. ................................................................................................................. 138
12. Responsibility of the registered person................................................................................................... 138
13. Deposit of withheld sales tax amounts. .................................................................................................. 139
14. Failure to pay tax withheld or deducted. ................................................................................................ 139
16. Active taxpayers’ list. ............................................................................................................................... 140
17. Repeal and Saving. ................................................................................................................................... 140
KHYBER PAKHTUNKHWA SALES TAX ON SERVICES (WITHHOLDING) REGULATION, 2020 ................................. 143
2. Definitions................................................................................................................................................ 143
3. Withholding agents and their responsibility. .......................................................................................... 144
4. Services not subject to withholding. ....................................................................................................... 145
5. Compulsory application of full withholding. ........................................................................................... 145
6. Extent of withholding in other cases. ...................................................................................................... 146
7. Input tax adjustment under withholding regime. ................................................................................... 146
8. Deposit time of withheld tax amounts. ................................................................................................... 146
9. Registration of withholding agents of different categories..................................................................... 147
10. Procedure for accounting and deposit of withheld amount of sales tax on services under different
accounting systems of the federal and provincial Governments. ........................................................................... 147
11. Monthly withholding statements by other withholding agents.............................................................. 149
12. Conditions for withholding from unregistered services providers.......................................................... 149
13. Issuance of withholding certificates. ....................................................................................................... 149
14. Adjudication for failure or default in tax withholding. ............................................................................ 149
15. Miscellaneous matters. ........................................................................................................................... 150
16. Repeal: ..................................................................................................................................................... 150
BALOCHISTAN SALES TAX SPECIAL PROCEDURE (WITHHOLDING) RULES, 2018 ................................................ 151
2. Definitions................................................................................................................................................ 152
4. Responsibility of registered service provider. ......................................................................................... 159
6. Forms prescribed for withholding agents................................................................................................ 159
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Page 6 of 166
Withholding Tax under INCOME TAX LAW
Time of deduction of tax
Section 158 - Time of deduction of tax
A person required to deduct tax from an amount paid by the person shall deduct tax -
(a) in the case of deduction under section 151, at the time the amount is paid or credited to the
account of recipient, whichever is earlier;
(b) in other cases, at the time the amount is actually paid; and
(c) amount actually paid shall have the meaning as may be prescribed.
Rule 43B - Amount actually paid under section 158

(1) The amount actually paid as per clause (c) of section 158 of the Ordinance includes.-
(a) amount paid by the person, as withholding agent;
(b) amount paid on behalf of the person, as withholding agent;
(c) amount paid at the instruction of the person, as withholding agent; and
(d) gross amount settled or discharged by the person, as withholding agent, to other person
before netting off or adjusting such amount against any receivable from the said other person.
(2) In case of remittance abroad to non-resident, seven days before the amount is intended to be
remitted abroad to that non-resident, through State Bank or any banking company.
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Payment of Tax Collected or Deducted
Section 160 - Payment of tax collected or deducted
Any tax that has been collected or purported to be collected under Division II of this Part or deducted or
purported to be deducted under Division III of this Part or deducted or collected, or purported to be deducted
or collected under Chapter XII shall be paid to the Commissioner by the person making the collection or
deduction within the time and in the manner as may be prescribed.
Rule 43 - Payment of tax collected or deducted

As required under section 160 and under the Sixth Schedule to the Ordinance, the tax collected or deducted
under Division II or Division III of Part V of Chapter X of the Ordinance, Chapter XII of the Ordinance or Sixth
Schedule to the Ordinance shall be paid to the Commissioner by way of credit to the Federal Government,-
(a) where the tax has been collected or deducted by the Federal Government or a Provincial
Government on the day the tax was collected or deducted; or
(b) where the tax has been collected or deducted by a person other than the Federal Government
or a Provincial Government,-
(i) by remittance to the Government Treasury or deposit in an authorized branch of the

State Bank of Pakistan or the National Bank of Pakistan, within Seven days from the
end of each week ending on every Sunday; and
(ii) by remittance abroad to a non-resident through State Bank or any other banking
company, prior to remitting abroad of the amount from which tax is to be deducted
or collected.
Provided that the tax collected by a banking company upto 19th July, 2015 in respect
of advance tax on banking transactions under section 236P of the Ordinance may be
deposited into the Government Treasury by 31st July, 2015.
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Certificate of collection or deduction of tax
Section 164 - Certificate of collection or deduction of tax
(1) Every person collecting tax under Division II of this Part or deducting tax from a payment under
Division III of this Part or deducting or collecting tax under Chapter XII shall, at the time of collection
or deduction of the tax, furnish to the person from whom the tax has been collected or to whom the
payment from which tax has been deducted has been made, copies of the challan of payment or any
other equivalent document alongwith a certificate setting out the amount of tax collected or deducted
and such other particulars as may be prescribed.
(2) A person required to furnish a return of taxable income for a tax year shall attach to the return copies
of the challan of payment on the basis of which a certificate is provided to the person under this
section in respect of tax collected or deducted in that year.
Rule 42 - Certificate of collection or deduction of tax

(1) As required under sub-section (1) of section 164, any person responsible for-
(a) collecting tax under Division II of Part V of Chapter X of the Ordinance;
(b) deducting tax from a payment under Division III of Part V of Chapter X of the Ordinance,
except in case of salary;
(c) collecting or deducting tax under Chapter XII of the Ordinance; or
(d) deducting tax under the Sixth Schedule to the Ordinance,
shall issue a certificate to the person from whom tax has been collected or deducted, in the form as
set out in Part VII of the Second Schedule to these rules, within fifteen days after the end of the
financial year or discontinuation of business etc.
(2) Where the person from whom tax has been collected or deducted requests for the issuance of the
certificate before the end of the financial year, the certificate under sub-rule (1) shall be issued for
the period in that year within seven days of the request made.
(3) Where the certificate issued under sub-rule (1) or sub-rule (2) has been lost, stolen or destroyed the
recipient of the certificate may request, in writing, to the issuer of the certificate to issue a duplicate
thereof.
(4) Where a request has been made under sub-rule (3), the issuer of the certificate shall comply with the
request and the certificate so issued shall be clearly marked “duplicate”.
(5) The certificate issued under sub-rule (1), (2) or sub-rule (3) shall be in duplicate and serially numbered.
Page 9 of 166
Withholding Tax Statement under INCOME TAX LAW
Section 165 - Statements
(1) Every person collecting tax under Division II of this Part or Chapter XII or the Tenth Schedule or
deducting tax from a payment under Division III of this Part or Chapter XII or the Tenth Schedule shall,
furnish to the Commissioner a quarterly statement in the prescribed form setting out-
(a) the name Computerized National Identity Card Number, National tax Number and address of
each person from whom tax has been collected under Division II of this Part or Chapter XII or
the Tenth Schedule or to whom payments have been made from which tax has been deducted
under Division III of this Part or Chapter XII or the Tenth Schedule in each quarter;
(b) the total amount of payments made to a person from which tax has been deducted under
Division III of this Part or Chapter XII or the Tenth Schedule in each quarter;
(c) the total amount of tax collected from a person under Division II of this Part or Chapter XII or
the Tenth Schedule or deducted from payments made to a person under Division III of this
Part or Chapter XII or the Tenth Schedule in each quarter; and
(d) such other particulars as may be prescribed:
Provided that every person as provided in sub-section (1) shall be required to file
withholding statement even where no withholding tax is collected or deducted during the
period:
Provided further that this section shall not apply where information required under
sub-section (1) has been furnished under section 165A.
Explanation.- For the removal of doubt, it is clarified that this sub-section overrides all conflicting
provisions contained in the Protection of Economic Reforms Act, 1992 (XII of 1992), the Banking
Companies Ordinance, 1962 (LVII of 1962), the Foreign Exchange Regulation Act, 1947 (VII of 1947)
and the regulations made under the State Bank of Pakistan Act, 1956 (XXXIII of 1956), if any, on the
subject, in so far as divulgence of information under section 165 is concerned.
(1A) Every person involved or engaged in economic transactions as prescribed by the Board shall furnish
to the Commissioner a quarterly statement in the prescribed form and manner.
(2) Every prescribed person collecting tax under Division II of this Part or Chapter XII or the Tenth
Schedule or deducting tax under Division III of this Part of Chapter XII or the Tenth Schedule shall
furnish statements under sub-section (1) or (1A) as per the following schedule namely:-
(a) in respect of quarter ending on the 31st day of March, on or before the 20th day of April;
(b) in respect of quarter year ending on the 30th day of June, on or before the 20th day of July;
(c) in respect of quarter ending on the 30th day of September, on or before the 20th day of
October; and
(d) in respect of quarter ending on or before the 31st day of December, on or before the 20th
January.
(2A) Any person who, having furnished statement under sub-section (1) or sub-section (2), discovers any
omission or wrong statement therein, may file a revised statement within sixty days of filing of
statement under sub-section (1) or sub-section (2), as the case may be.
(2B) Notwithstanding anything contained in this section, the Commissioner as he deems fit may by notice
in writing require any person, collecting or deducting tax under this Ordinance, to furnish a statement
for any period specified in the notice within such period of time as may be specified in the notice.
(3) Board may prescribe a statement requiring any person to furnish information in respect of any
transactions in the prescribed form and verified in the prescribed manner.
Page 10 of 166
(4) A person required to furnish a statement under sub-section (1), may apply in writing, to the
Commissioner for an extension of time to furnish the statement after the due date and the
Commissioner if satisfied that a reasonable cause exists for non-furnishing of the statement by the
due date may, by an order in writing, grant the applicant an extension of time to furnish the
statement.
(5) The Board may make rules relating to electronic furnishing of statements under this section including,-
(a) mandatory electronic filing of statements; and
(b) determination of eligibility of the data of such statements and e-intermediaries, etc.
(6) Every person deducting tax from payment under section 149 shall furnish to the Commissioner an
annual statement in the prescribed form and manner.
Rule 44 - Statement of tax collected or deducted

1
[ ]
(2) Pursuant to sub-section (2) of section 165, a person responsible for collecting or deducting tax under
Division II or Division III of Part V of Chapter X of the Ordinance or under Chapter XII of the Ordinance
shall furnish or e-file a biannual statement as set out in part X of the day of the Second Schedule to
these rules as per the following timelines, namely:-
(a) in respect of the half-year ending on the 30th June, on or before the 31st day of July;
(b) in respect of the half-year ending on the 31st December, on or before the 31st January.
(3) The statement referred to in sub-rule (2) shall be accompanied by the evidence of deposit of tax
collected or deducted to the credit of the Federal Government.
(4) A person required to furnish the statement under sub-rule (2) shall, wherever required by the
Commissioner, furnish a reconciliation of the amounts mentioned in the aforesaid biannual
statements with the amounts mentioned in the return of income, statements, related annexes and
other documents submitted from time to time.
(5) Pursuant to sub-section (6), a person responsible for deducting tax under section 149 shall furnish or
e-file annual statement by the 31st day of the month of July after the end of a financial year in the
form set out in Part IX of the Second Schedule to these rules.
1 Sub-rule (1) omitted by SRO 1218(I)/2015 dated: December 08, 2015. Earlier it was:
(1) An annual statement required to be furnished under sub-section (1) of section 165 for a financial year shall be in the form
as set out in Part VIII and Part IX of the Second Schedule to these rules.
Page 11 of 166
Recovery of tax
Section 161 - Failure to pay tax collected or deducted
(1) Where a person -
(a) fails to collect tax as required under Division II of this Part or Chapter XII or deduct tax from a
payment as required under Division III of this Part or Chapter XII or as required under section
50 of the repealed Ordinance; or
(b) having collected tax under Division II of this Part or Chapter XII or deducted tax under Division
III of this Part or Chapter XII fails to pay the tax to the Commissioner as required under section
160, or having collected tax under section 50 of the repealed Ordinance pay to the credit of
the Federal Government as required under sub-section (8) of section 50 of the repealed
Ordinance,
the person shall be personally liable to pay the amount of tax to the Commissioner who may pass an
order to that effect and proceed to recover the same.
(1A) No recovery under sub-section (1) shall be made unless the person referred to in sub-section (1) has
been provided with an opportunity of being heard.
(1B) Where at the time of recovery of tax under sub-section (1) it is established that the tax that was to be
deducted from the payment made to a person or collected from a person has meanwhile been paid
by that person, no recovery shall be made from the person who had failed to collect or deduct the tax
but the said person shall be liable to pay default surcharge at the rate of twelve percent per annum
from the date he failed to collect or deduct the tax to the date the tax was paid.
(2) A person personally liable for an amount of tax under sub-section (1) as a result of failing to collect or
deduct the tax shall be entitled to recover the tax from the person from whom the tax should have
been collected or deducted.
(3) The Commissioner may, after making, or causing to be made, such enquiries as he deems necessary,
amend or further amend an order of recovery under sub-section (1), if he considers that the order is
erroneous in so far it is prejudicial to the interest of revenue:
Provided that the order of recovery shall not be amended, unless the person referred to in
sub-section (1) has been provided an opportunity of being heard.
Section 162 - Recovery of tax from the person from whom tax was not
collected or deducted
(1) Where a person fails to collect tax as required under Division II of this Part or Chapter XII or deduct
tax from a payment as required under Division III of this Part or Chapter XII, the Commissioner may
pass an order to that effect and recover the amount not collected or deducted from the person from
whom the tax should have been collected or to whom the payment was made.
(2) The recovery of tax under sub-section (1) does not absolve the person who failed to deduct tax as
required under Division III of this Part or Chapter XII from any other legal action in relation to the
failure, or from a charge of default surcharge or the disallowance of a deduction for the expense to
which the failure relates, as provided for under this Ordinance.
(3) The Commissioner may, after making, or causing to be made, such enquiries as he deems necessary,
amend or further amend an order of recovery under sub-section (1), if he considers that the order is
erroneous in so far it is prejudicial to the interest of revenue:
Provided that the order of recovery shall not be amended, unless the person referred to in
sub-section (1) has been provided an opportunity of being heard.
Page 12 of 166
Section 163 - Recovery of tax from the person from whom tax was not
collected or deducted
The provisions of this Ordinance shall apply to any amount required to be paid to the Commissioner
under this Division as if it were tax due under an assessment order.
Page 13 of 166
Relevant Penalties
Section 182 - Offences and penalties
Section of the
Sr. # Offences Penalties Ordinance to
which offence
has reference.
(1) (2) (3) (4)
1A Where any person fails to furnish a Such person shall pay a penalty of 165, 165A and
statement as required under section 115, Rs. 5000 if the person had already 165B
165, 165A or 165B within the due date. paid the tax collected or withheld by
him within the due date for
payment and the statement is filed
within ninety days from the due
date for filing the statement and, in
all other cases, a penalty of Rs. 2500
for each day of default from the due
date subject to a minimum penalty
of Rs. 10,000:
1
Provided that where it
stands established that no tax was
required to be deducted or
collected during the relevant
period, minimum amount of penalty
shall be ten thousand Rupees.
5 Any person who fails to deposit the Such person shall pay a penalty of 137
amount of tax due or any part thereof in five per cent of the amount of the
the time or manner laid down under this tax in default.
Ordinance or rules made thereunder.
For the second default an additional
2
[Provided that if the person opts to pay penalty of 25% of the amount of tax
the tax due on the basis of an order under in default.
section 129 on or before the due date
For the third and subsequent
given in the notice under sub-section (2) of
defaults an additional penalty of
section 137 issued in consequence of the
50% of the amount of tax in default.
said order, and does not file an appeal
under section 131 the penalty payable
shall be reduced by 50%.]
6 Any person who repeats erroneous Such person shall pay a penalty of 137
calculation in the return for more than one thirty thousand rupees or three per
year whereby amount of tax 3[paid is] less cent of the amount of the tax
than the actual tax payable under this involved, whichever is higher:
5
4
Ordinance [ ]. Provided that no penalty
shall be imposed to the extent of
the tax shortfall occurring as a result
of the taxpayer taking a reasonably
arguable position on the application
1 Proviso inserted by Finance Act, 2021.

3 Words inserted by Finance Act, 2021.
4 Word “is paid” omitted by Finance Act, 2021.
5 Colon and Proviso inserted by Finance Act, 2021.
Page 14 of 166
of this Ordinance to the taxpayer’s
position.
7 Any person who fails to maintain records Such person shall pay a penalty of 1741[, 108]
required under this Ordinance or the rules ten thousand rupees or five percent
made thereunder of the amount of tax on income
whichever is higher
10 Any person who- Such person shall pay a penalty of 114, 3[ ], 116,
(a) makes a false or misleading statement twenty five thousand rupees or 174, 176, 177
2
to an Inland Revenue Authority either in [50%] of the amount of tax shortfall and general.
writing or orally or electronically including whichever is higher:
a statement in an application, certificate, Provided that in
declaration, notification, return, objection case of an assessment order
or other document including books of deemed under section 120, no
accounts made, prepared, given, filed or penalty shall be imposed to the
furnished under this ordinance; extent of the tax shortfall occurring
(b) furnishes or files a false or misleading as a result of the taxpayer taking a
information or document or statement to reasonably arguable position on the
an Income tax Authority either in writing or application of this Ordinance to the
orally or electronically; taxpayer‘s position.
(c) omits from a statement made or
information furnished to an Income tax
Authority any matter or thing without
which the statement or the information is
false or misleading in a material particular.
14 Any person who contravenes any of the Such person shall pay a penalty of General
provision of this Ordinance for which no five thousand rupees or three
penalty has, specifically, been provided in percent of the amount of tax
this section involved, whichever is higher
4
15 Any person who fails to collect or deduct Such person shall pay a penalty of [Division II or
tax as required under any provision of this forty thousand rupees or 10% of the Division III of
Ordinance or fails to pay the tax collected amount of tax whichever is higher. Part V of
or deducted as required under section 160 Chapter X or
Chapter XII]
1 Figure inserted by Finance Act, 2017.

2 Figure “100%” substituted by Finance Act, 2021.
3 Figure “115” omitted by Finance Act, 2020.
4 Figures and word “148, 149, 150, 151, 152, 153, 153A, 154, 155, 156, 156A, 156B, 158, 160, 231A, 231B, 233, 233A, 234, 234A,
235, 236, 236A” substituted by Finance Act, 2019.
Page 15 of 166
Exemption or lower rate certificate
Section 159 - Exemption or lower rate certificate
(1) Where the Commissioner is satisfied that an amount to which Division II or III of this Part or Chapter
XII applies is -
(a) exempt from tax under this Ordinance; or
(b) subject to tax at a rate lower than that specified in the First Schedule; or
(c) is subject to hundred per cent tax credit under 1[under this Ordinance,] the Commissioner
shall, upon application in writing by the person 2[in the prescribed form], issue the person
with an exemption or lower rate certificate:
3
Provided that in case of a company, the Commissioner shall issue exemption or lower
rate certificate under this section within fifteen days of filing of application by the company:
4
Provided further that the Commissioner shall be deemed to have issued the
exemption certificate upon the expiry of fifteen days from filing of application by the aforesaid
company and the certificate shall be automatically processed and issued by Iris:
5
Provided also that the Commissioner may modify or cancel the certificate issued
automatically by Iris on the basis of reasons to be recorded in writing after providing an
opportunity of being heard.
(1A) The Commissioner shall, upon application from a person in the prescribed form whose income is not
likely to be chargeable to tax under this Ordinance, issue exemption certificate for the profit on debt
referred to in clause (c) of sub-section (1) of section 151.
(2) A person required to collect advance tax under Division II of this Part or deduct tax from a payment
under Division III of this Part or deduct or collect tax under Chapter XII shall collect or deduct the full
amount of tax specified in Division II or III or Chapter XII, as the case may be, unless there is in force a
certificate issued under sub-section (1) relating to the collection or deduction of such tax, in which
case the person shall comply with the certificate.
(6) Notwithstanding omission of sub-sections (3), (4) and (5), any notification issued under the said sub-
sections and for the time being in force, shall continue to remain in force, unless rescinded by the
Board through notification in the official Gazette.
Rule 40 - Exemption or lower rate certificate u/s 159

(1) An application for a certificate under sub-section (1) of section 159 shall be made in the form specified
in Part-VII of the First Schedule to these rules.
(2) A certificate issued by the Commissioner under sub-section (1) of section 159 shall be in the form
specified in Part VIII of the First Schedule to these rules.
(3) An application for a certificate under sub-section (1) of section 159 read with clause (v) of paragraph
1 of Notification No. S.R.O 947(1)/2008, dated the 5th September, 2008, shall be in the form specified
in Part VII(a) of the First Schedule to these rules.
(4) A system based exemption certificate issued by the Commissioner for goods specified under clause
(v) of paragraph 1 of Notification No. S.R.O. 947(1)2008, dated the 5th September, 2008 shall be in the
1 Words “section 100C” inserted by Finance Act, 2021.

2 Words inserted by Finance Act 2020.
Page 16 of 166
form specified in Part-VIII(a) of the First Schedule to these rules.
Provisions relating to persons not appearing in active

taxpayers' list
Section 100BA - Special provisions relating to persons not appearing in active

taxpayers' list
(1) The collection or deduction of advance income tax, computation of income and tax payable thereon
1
[in respect of a person not appearing on the active taxpayers‘ list] shall be determined in accordance
with the rules in the Tenth Schedule.
(2) The provisions of the Tenth Schedule shall have effect notwithstanding anything to the contrary
contained in this Ordinance.
THE TENTH SCHEDULE

(See section 100BA)
RULES FOR PERSONS NOT APPEARING IN THE ACTIVE TAXPAYERS' LIST
1. Rate of deduction or collection of tax.
Where tax is required to be deducted or collected under any provision of this Ordinance from persons
not appearing in the active taxpayers' list, the rate of tax required to be deducted or collected, as the
case may be, shall be increased by hundred percent of the rate specified in the First Schedule to this
Ordinance.
2. Persons not required to file return or statement.

(1) Where the withholding agent or the person from whom tax is required to be collected or deducted is
satisfied that a person not appearing in the active taxpayers' list was not required to file a return of
income under section 114, 2[ ] as the case may be, he shall before collecting or deducting tax under
this Ordinance, furnish to the Commissioner a notice in writing electronically setting out—
(a) the name, CNIC or NTN and address of the person not appearing in the active taxpayers' list;
(b) the nature and amount of the transaction on which tax is required to be collected or
deducted; and
(c) reason on the basis of which it is considered that the person was not required to file return
or statement, as the case may be.
(2) The Commissioner, on receipt of a notice under sub-rule (1), shall within thirty days pass an order
accepting the contention or making the order under sub-rule (3).
(3) Where the withholding agent or the person from whom tax is required to be collected or deducted
has notified the Commissioner under sub-rule (1) and the Commissioner has reasonable grounds to
believe that the person not appearing in the active taxpayers' list was required to file return or
statement, as the case may be, the Commissioner may, by an order in writing, direct the withholding
agent to deduct or collect tax under rule 1:
Provided that in case the Commissioner does not pass any order within thirty days of receipt
of notice under sub-rule (1), the Commissioner shall be deemed to have accepted the contention
under sub-rule (2) and approval shall be treated to have been granted.

2 Words “or a statement under sub-section (4) of section 115,” omitted by Finance Act, 2020.
Page 17 of 166
3. Provisional assessment.
(1) Where for a tax year a person's tax has been collected or deducted in accordance with rule 1 and the
person fails to file return of income 1[ ] for that tax year within the due date provided in section 118
or as extended by the Board, the Commissioner shall notwithstanding anything contained in sub-
sections (3) and (4) of section 114 2[ ] within sixty days of the due date provided in section 118 or as
extended by the Board make a provisional assessment of the taxable income of the person and issue
a provisional assessment order specifying the taxable income assessed and tax due thereon.
(2) In making the provisional assessment under sub-rule (1), the Commissioner shall impute taxable
income on the amount of tax deducted or collected under rule 1 by treating the imputed income as
concealed income for the purposes of clause (d) of sub-section (1) of section 111:
Provided that the provision of section 111 shall be applicable on unexplained income, asset
or expenditure in excess of imputed income treated as concealed income under this rule.
Explanation.— For the removal of doubt it is clarified that the imputable income so calculated
or concealed income so determined shall not absolve the person so assessed, from requirement of
filing of wealth statement under sub-section (1) of section 116, the nature and source of amounts
subject to deduction or collection of tax under section 111, selection of audit under section 177 or
214C or subsequent amendment of assessment as provided in rule 8 and all the provisions of the
Ordinance shall apply.
4. Finalization or abatement of provisional assessment.

(1) The provisional assessment under rule 3, shall be treated as the final assessment order after the expiry
of forty-five days from the date of service of order of provisional assessment and the provisions of
this Ordinance shall apply accordingly.
(2) The provisional assessment shall stand abated and shall be taken to be assessment finalized under
sub-section (1) of section 120 where the returns of income and wealth statement for the relevant tax
year and the preceding tax year along with prescribed forms, statements or documents are filed by
the person within a period of forty-five days of receipt of provisional assessment order.
(3) Where returns have been filed before provisional assessment or under sub-rule (2), the tax deducted
or collected under rule 1 shall be adjustable against the tax payable in the return filed for the relevant
tax year.
5. Where the provisional assessment has been treated as final assessment under sub-rule (1) of rule 4,
the Commissioner may within thirty days of the final assessment initiate proceedings for imposition
of penalties under section 182 on account of non-furnishing of return and concealment of income.
6. For the purposes of this Schedule, imputed income means—

(a) income for individuals and association of persons which would have resulted in the amount
of tax given in paragraph (1) of Division I of the First Schedule equal to the tax collected or
deducted under rule 1 for not appearing in the active taxpayers' list; or
(b) income for companies which would have resulted in the amount of tax given in Division II of
the First Schedule equal to the tax collected or deducted at the higher rate under rule 1 for
not appearing in the active taxpayers' list.
7. Where the withholding agent fails to furnish in the withholding statement complete or accurate
particulars of persons not appearing on active taxpayers' list, the Commissioner shall initiate
proceedings under sections 182 and 191 against the withholding agent within thirty days of filing of
withholding statement under section 165.
1 Words “or statement, as the case may be,” omitted by Finance Act, 2020.
2 Words “or a statement under sub-section (4) of section 115,” omitted by Finance Act, 2020.
Page 18 of 166
8. Amendment of assessment.
(1) The Commissioner may amend an assessment order where the imputed income is less than the
amount on which tax was deducted or collected under rule 1 or on the basis of definite information
acquired from an audit or otherwise, the Commissioner is satisfied that—
(a) any income chargeable to tax has escaped assessment; or
(b) total income has been under-assessed, or assessed at too low a rate, or has been the subject
of excessive relief or refund; or
(c) any amount under a head of income has been misclassified.
(2) Notwithstanding the provisions of sub-rule (1), where a provisional assessment has been treated as
final assessment or where in response to the provisional assessment, return has been filed within
forty- five days or where assessment has been amended under sub-rule (1) and the assessment order
is considered erroneous in so far it is prejudicial to the interest of revenue, the Commissioner may,
after making or causing to be made, such enquiries as he deems necessary, amend the assessment
order.
(3) For the purposes of sub-rule (1), "definite information" shall have the same meaning as defined in
sub-section (8) of section 122.
9. Provisions of Ordinance to apply.

The provisions of this Ordinance not specifically dealt with in the aforesaid rules shall apply, mutatis
mutandis, in the case of proceedings against the persons not appearing on active taxpayers' list.
10. The provisions of this Schedule shall not apply on tax collectible or deductible in case of the
following sections:-
(a) tax deducted under section 149;
(b) tax deducted under section 152 other than sub-section 1[(2A)(a),] (2A)(b) and (2A)(c) of
section 152
(ba) Tax deducted under clause (5A) of Part II of the Second Schedule read with sub-section (2) of
section 152.
(bb) tax deducted under sub-section (2) of section 152 to the extent of clause (5AA) of Part II.
(c) tax collected or deducted under section 154;
(e) tax deducted under section 156B.
(i) tax deducted under section 235;
(l) tax collected under section 236;
(p) tax collected under section 236I;
(t) tax collected under section 236Q;
List of Sections on which 10th Schedule is applicable

Section 148 Imports
Section 150 Dividends
Section 150A Return on Investment In Sukuks
Section 151 Profit on debt
Payment to non-resident for royalty, fee for technical services, insurance
Section 152 [sub-
and reinsurance premium, transactions not mentioned in 152 and are
section (1), (1AA), (2),
subject to 20% rate of tax, payment against services and contract to PE of
(2A)(b) and (2A)(c)]
non-resident
Section 152A Payment for foreign produced commercials
Section 153 Payments for goods, services and contracts
Section 153B Payment of royalty to resident persons
Section 155 Rent of immoveable property
Section 156 Prizes and winnings
1 Expression “(1), (1AA), (2)” substituted by Finance Act, 2020.

Page 19 of 166
Section 156A Petroleum Products
Section 231B Advance tax on private motor vehicles
Section 233 Brokerage and commission
Section 233A Collection of tax by a stock exchange registered in Pakistan
Section 234 Tax on motor vehicles
Section 234A CNG Stations
Section 236A Advance tax at the time of sale by auction
Section 236C Advance Tax on sale or transfer of immovable property
Section 236G Advance tax on sales to distributors, dealers and wholesalers
Section 236H Advance tax on sales to retailers
Section 236HA Tax on sale of certain petroleum products
Section 236K Advance tax on purchase or transfer of immovable property
Section 236S Dividend in specie
Advance Tax on persons remitting amounts abroad through credit or debit
Section 236Y
or prepaid cards
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 100BA, 10th Schedule)

The provisions of section 100BA and rule 1 of the Tenth Schedule shall not apply to non-resident individual
holding Pakistan Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) or Computerized
National ID Card (CNIC) maintaining a Foreign Currency Value Account (FCVA) or Non-resident Pakistani Rupee
Value Account (NRVA) with authorized banks in Pakistan under the foreign exchange regulations issued by the
State Bank of Pakistan. [Clause (111AB), Part IV, 2nd Schedule]
Page 20 of 166
Transactions subject to Withholding Tax under INCOME TAX
LAW
Section 148 - Imports
(1) The Collector of Customs shall collect advance tax from every importer of goods on the value of the
goods at the rate specified in Part II of the First Schedule 1[in respect of goods classified in Parts I to
III of the Tenth Schedule] 2:
Provided that the Board may, by a notification in the official Gazette, add in the Twelfth
Schedule any entry thereto or omit any entry therefrom or amend any entry therein:
Provided further that in case of goods classified under Part III of the Twelfth Schedule which
are used both as raw material and finished goods, the Board may, by notification in the official
Gazette, specify that goods imported by a person or class of persons as raw material for its own use
shall be treated as classified under Part II of the Twelfth Schedule, subject to such conditions and
procedure as may be prescribed.]
3
[ ]
4
(2A) Notwithstanding omission of sub-section (2), any notification issued under the said sub-section and
for the time being in force, shall continue to remain in force, unless amended or rescinded by the
Board through notification in the official Gazette.
5
[ ]
6
[ ]
7
[ ]
(5) Advance tax shall be collected in the same manner and at the same time as the customs-duty payable
in respect of the import or, if the goods are exempt from customs-duty, at the time customs-duty
would be payable if the goods were dutiable.
(6) The provisions of the Customs Act, 1969 (IV of 1969), in so far as relevant, shall apply to the collection
of tax under this section.
(7) The tax required to be collected under this section shall be 8[minimum] tax 9[ ] on the income of the
importer arising from the imports subject to sub-section (1) and this sub-section shall not apply in the
case of import of 10[goods on which tax is required to be collected under this section at the rate of 1%
or 2% by an industrial undertaking for its own use.]
11
[]

2 Colon and proviso inserted Finance Act, 2020.
3 Sub-section (2) omitted by Finance Act, 2015. Earlier it was:
(2) Nothing contained in sub-section (1) shall apply to any goods or class of goods or persons or class of persons importing such
goods or class of goods as may be specified by the Board.
4 Sub-section (2A) inserted by Finance Act, 2015.
5 Sub-section (3) omitted by Finance Act, 2007.
6 Sub-section (4) omitted by Finance Act, 2007. Earlier it was substituted by Finance Act, 2003.
7 Sub-section (4A) omitted by Finance Act, 2008. Earlier it was substituted by Finance Act, 2007. Sub-section (4A) inserted by Finance
Act 2003.
8 Words “a final” substituted by Finance Act, 2019.
9 Words “except as provided under sub-section (8)” omitted by Finance Act 2019. Earlier it was inserted by Finance Act, 2010.
11 Clause (a), (c), (d) and (e) omitted by Finance Act, 2020. Earlier it was:
(a) raw material, plant, machinery, equipment and parts by an industrial undertaking for its own use;
(c) motor vehicles in CBU condition by manufacturer of motor vehicles.
(d) large import houses, who-
(i) have paid-up capital of exceeding Rs. 250 million;
Page 21 of 166
1
[]
2
[]
(9) In this section -
“Collector of Customs” means the person appointed as Collector of Customs under section 3 of the
Customs Act, 1969 (IV of 1969), and includes a Deputy Collector of Customs, an Additional Collector
of Customs, or an officer of customs appointed as such under the aforesaid section; 3[ ]
4
[Value of goods means—
(a) in case of goods chargeable to tax at retail price under the Third Schedule of the Sales Tax Act,
1990, the retail price of such goods increased by sales tax payable in respect of the import
and taxable supply of the goods; and
(b) in case of all other goods; the value of the goods as determined under the Custom Act, 1969
(IV of 1969), as if the goods were subject to ad valorem duty increased by the custom-duty,
federal excise duty and sales tax, if any, payable in respect of the import of the goods.]
5
[ ]
6
[]
(ii) have imports exceeding Rs.500 million during the tax year;
(iii) own total assets exceeding Rs. 350 million at the close of the tax year;
(iv) is single object company;
(v) maintain computerized records of imports and sale of goods;
(vi) maintain a system for issuance of 100% cash receipts on sales;
(vii) present accounts for tax audit every year;
(viii) is registered under the Sales Tax Act, 1990; and
(ix) make sales of industrial raw material of manufacturer registered under the Sales Tax Act, 1990; and
(e) a foreign produced film imported for the purpose of screening and viewing.
1 Clause (b) omitted by Finance Act, 2017. Earlier it was:
(b) fertilizer by manufacturer of fertilizer; and
2 Sub-section (8) and (8A) omitted by Finance Act, 2020.Earlier it was:
(8) The tax required to be collected from a person under this section shall be minimum tax for a tax year on the import of─
[]
(b) edible oil;
(c) packing material; and
(d) plastic raw material imported by an industrial undertaking falling under PCT headings 39.01 to 39.12.
(8A) The tax collected under this section at the time of import of ships by ship-breakers shall be minimum tax.
3 The word “and” omitted by Finance Act, 2009.
4 Expression “value of goods” means the value of the goods as determined under the Customs Act, 1969 (IV of 1969), as if the
goods were subject to ad valorem duty increased by the customs-duty, federal excise duty and sales tax, if any, payable in respect
of the import of the goods.” substituted by Finance Act, 2020.
5 Definition omitted by Finance Act, 2005. Earlier it was inserted by Finance Act, 2004.
6 Explanation omitted by Finance Act, 2020. Earlier it was:
Explanation.- For the purpose of this section the expression “edible oils” includes crude oil, imported as raw material for
manufacture of ghee or cooking oil.
Page 22 of 166
1WITHHOLDING TAX RATES (Double rates applicable on persons not appearing in the ATL)
Withholding Adjustable / Final
Section Nature of Payment / Transaction Rate Agent / Minimum
148 Imports
Persons importing goods classified 1% of the import value as Collector M
(A for industrial
1. in Part I of the Twelfth Schedule increased by customs-duty, sales of
undertaking importing
Part I, Twelfth Schedule tax and federal excise duty Customs for its own use)
1 Part II of First Schedule substituted by Finance Act, 2020. Earlier it was:

WITHHOLDING TAX RATES (Double rates applicable on persons not appearing in the ATL)
Withholding Adjustable / Final
Section Nature of Payment / Transaction Rate Agent / Minimum
148 Imports
1. (i) Industrial undertaking importing remeltable steel (PCT 1% of the import value as
Heading 72.04) and directly reduced iron for its own use; increased by customs-duty, A
(ii) Person importing potassic fertilizers in pursuance of sales tax and federal excise
Economic Coordination Committee of the cabinet’s duty
decision No.ECC-155/12/2004 dated the 9th December, M
2004;
(iii) Persons importing urea;
(iv) Manufacturers covered under Notification No. M
S.R.O.1125(I)/2011 dated the 31st December, 2011 and
importing items covered under S.R.O.1125(I)/2011 dated A
the 31st December, 2011;
(v) Persons importing Gold; M
(vi) Persons importing Cotton; and M
(vii)Persons importing LNG M
2% of the import value as Collector
increased by customs-duty, of
2. Persons importing pulses Customs M
sales tax and federal excise
duty
Commercial importers covered under Notification No. S.R.O. 3% of the import value as
1125(I)/2011 dated the 31st December, 2011 and importing increased by customs-duty,
3. M
items covered under S.R.O. 1125(I)/2011 dated the 31st sales tax and federal excise
December, 2011. duty
4. Persons importing coal 4% M
Persons importing finished pharmaceutical products that are
5. not manufactured otherwise in Pakistan, as certified by the M
Drug Regulatory Authority of Pakistan 4%
6. Ship breakers on import of ships 4.5% M
7. Industrial undertakings not covered under S. Nos. 1 to 6 5.5% A
8. Companies not covered under S. Nos. 1 to 7 5.5% M
9. Persons not covered under S. Nos. 1 to 8 6% M
Provided that the rate specified in column (3),
(a) in the case of industrial undertaking, importing plastic raw material falling under PCT Heading 39.01 to 39.12 for its
own use shall be 1.75% of the import value as increased by customs duty, sales tax and Federal excise duty; and
(b) in the case of a commercial importer, importing plastic raw material falling under PCT Heading 39.01 to 39.12 shall
be 4.5 % of the import value as increased by customs duty, sales tax and Federal excise duty:
Provided further that the rate of tax on value of import of mobile phone by any person shall be as set out
in the following Table, namely:-
Table
C & F Value of mobile phone Tax
S. No. (in US Dollar) (in Rs.)
(1) (2) (3)
1 Up to 30 70
2 Exceeding 30 and up to 100 100
5 Exceeding 350 and up to 500 3,000
6 Exceeding 500 5,200
Page 23 of 166
Persons importing goods classified 2% of the import value as M
(A for industrial
2. in Part II of the Twelfth Schedule increased by customs-duty, sales
undertaking importing
Part II, Twelfth Schedule tax and federal excise duty for its own use)
Persons importing goods classified 5.5% of the import value as
3. in Part III of the Twelfth Schedule increased by customs-duty, sales M
Part III, Twelfth Schedule tax and federal excise duty
Provided that the rate specified in column (3),

(a) in case of manufacturers covered under rescinded Notification No. S.R.O. 1125(I)/2011 dated
the 31st December, 2011 as it stood on the 28th June, 2019 on import of items covered under
the aforementioned S.R.O. shall be 1%; and
(b) in case of persons importing finished pharmaceutical products that are not manufactured
otherwise in Pakistan, as certified by the Drug Regulatory Authority of Pakistan shall be 4%:
Provided further that the rate of tax on value of import of mobile phone by any person
shall be as set out in the following table, namely: –
Table
Tax (in Rs.)
S. No. C & F Value of mobile phone In CBU condition In CKD/SKD condition
(in US Dollar) PCT Heading under PCT Heading
8517.1219 8517.1211
(1) (2) (3) (4)
1 Up to 30 except smart phones 70 0
2 Exceeding 30 and up to 100 and 100 0
smart phones up to 100
3 Exceeding 100 and up to 200 930 0
6 Exceeding 500 5200 11500
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 148 - Imports)

1. Goods imported by Federal Government. [Section 49]
2. Goods imported by Provincial Government. [Section 49 and SRO 947(I)/2008, 05-09-2008]
3. Goods imported by a Local Government. [Section 49 and SRO 947(I)/2008, 05-09-2008]
4. In respect of import of white sugar from the 25th day of August, 2020 to the 15th day of November, 2020 both
days inclusive, tax under section 148 shall be collected at the rate of 0.25% as per quantity, quality, mode and
manner prescribed by Ministry of Commerce during the said period. [Clause (9AA) of Part II of Second
Schedule]
5. Tax under section 148 on commercial import of the white sugar shall be collected at the rate of 0.25% from
the 26th day of January 2021 till the 30th day of June, 2021. [Clause (9AB) of Part II of Second Schedule]
6. Subject to quota allotment by Commerce Division, tax under section 148 shall be collected at the rate of
0.25% on import of raw sugar imported by sugar mills from the 26th day of January, 2021 to the 30th day of
June, 2021 both days inclusive provided that such imports shall not exceed fifty thousand metric tons per
sugar mill and three hundred thousand metric tons in aggregate by the sugar industry. [Clause (9AC) of Part
II of Second Schedule]
7. Goods imported by Institutions of the Agha Khan Development Network (Pakistan) listed in Schedule 1 of the
Accord and Protocol dated November 13, 1994, executed between the Government of the Islamic Republic
of Pakistan and Agha Khan Development Network. [Clause (16) of Part IV of 2nd Schedule]
8. The provisions of section 148 shall not apply to the import of following goods for a period commencing
from 20th day of March, 2020 and ending on 1[30th day of June, 2021].
TABLE
1 Words “30th day of September, 2020” substituted by Finance Act, 2021.

Page 24 of 166
S. No. Description PCT
(1) (2) (3)
1. Real-time PCR system (standard 96-well plate and 0.2mI tubes format, 5
channel)
2. Biosafety Cabinet
3. Auto Clave 50 Liter Capacity
4. Multi channel pipette (0.5-10 μl)
5. Single channel pipette
a) 2 μl b) 10 μl c) 200 μl d) 1000 μl
6. Muti channel pipette 20-200 ml
7. Vacuum fold
8. Micro Centrifuge
(Non-refrigerated, Rotor capacity: 12 x 1.5 / 2.0 ml vessels, 2 x PCR strip, Max. Respective
speed: 12,100 x g (13,400 rpm)) headings
9. PCR Cabinet (HEPA filter system, UV and white light)
10. Real-time PCR kit for the detection of Coronavirus (SARS-CoV-2)
11. Viral RNA Extraction Kit and machine (Automatic Extractors)
12. VTM (Viral Transport Medium)
13. Dr Oligo Synthesizer
14. Refrigerator/freezer (-20 °C)
15. Vortex Machine
16. Refrigerated Centrifuge Machine (Rotor capacity 1.5mI x 24, max. speed 14000
rpm)
17. UPS (6 KVA)
18. Tyvek Suits
19. N-95
20. Biohazard Bags (18 Liters)
21. PAPR (Powdered Air Purifying respirators)
22. Multimode ventilator with air compressor
23. Vital sign monitor with 2lBPand ETco2 two Temp.
24. ICU motorized patient bed with side cabinet and over bed table
25. Syringe infusion pump
26. Infusion pump
27. Electric suction machine
28. Defibrillator
29. X-Ray Mobile Machine
30. Simple Nebulizer
31. Ultrasound machine
32. Noninvasive BIPAP
33. ECG Machine
34. Pulse Oximeters
35. Ripple mattress
36. Blood gas analyzer
37. AMBU Bag
38. Nitrile Gloves
39. Latex Gloves
40. Goggles
41. Face Shields
42. Gum Boots
43. Mackintosh bed sheets
44. Surgical Masks
45. Air Ways
46. Diaflow
47. Disposible Nebulizer Mask Kit
48. ECG Electrodes
49. ETT Tube (Endotracheal Tubes) All sizes
50. Humidifier Disposable Flexible
51. IV Cannula all sizes
52. IV Chambers
53. Oxygen Recovery Kit
Page 25 of 166
54. Padded Sheets
55. Stomach Tube
56. Stylet for Endotracheal Tube
57. Suction Tube control valve
58. Tracheostomy Tube 7, 7.5, 8
59. Ventilator Circuit
60. Ventury Masks
61. Disposable shoes cover (water proof)
[Clause (12B) of Part IV of 2nd Schedule]
1
9. The provision of section 148 shall not apply to persons importing pulses for a period commencing from
the date of issuance of this notification till 30th June, 2020. [Clause (12C) of Part IV of 2nd Schedule]
2
10. The provisions of section 148 shall not apply on the import of finished drug Remdesivir 100 mg injection
and injectable solution 100 mg vial for the period starting from the 22nd day of June, 2020 and ending on
the date as may be notified by the Board in the official Gazette on recommendation of the National Health
Services, Regulation and Coordination Division. [Clause (12D) of Part IV of 2nd Schedule]
3
11. The provisions of section 148 shall not apply to persons on import of medicines for treatment of life
threatening rare diseases not manufactured in Pakistan, subject to the following conditions, namely:–
(i) the import is approved by the Board, through notification in the official Gazette;
(ii) the specification and quantity of medicine is recommended by the National Health Services,
Regulation and Coordination Division in a prescribed format on a case to case basis; and
(iii) such medicine is required for the personal use of the importing person or his immediate family
member:
Provided that where circumstances exist to take immediate action in emergency situations, the Board
may, on recommendation of a provincial health department or a tertiary care hospital of the Federal or
Provincial Government, provisionally allow import of such quantity of medicine under this clause which
does not exceed sixty days usage. [Clause (12E) of Part IV of 2nd Schedule]
12. The provision of section 148 shall not apply on import of 1.5 million tons of wheat having PCT Heading
1001.1900 and 1001.9900 in pursuance of Cabinet Decision in case No.399/23/2020 dated the 16 th June,
2020. [Clause (12F) of Part IV of 2nd Schedule]
13. The provisions of section 148 shall, in pursuance of the Cabinet Decision in case No. 541/30/2020 dated
the 4th August, 2020, not apply on import by the Trading Corporation of Pakistan of 300,000 metric tons
of white sugar having PCT heading 1701.9910, 1701.9920, specification B. [Clause (12G) of Part IV of 2nd
Schedule]
14. (a) The provisions of section 148 shall not apply on import of following goods for a period of three
months starting from 23rd of June, 2020, namely:-
S. No. Description PCT Code
(1) (2) (3)
1 Oxygen gas 2804.4000
2 Cylinders (for oxygen gas) 7311.0090
3 Cryogenic tanks (for oxygen gas) 7311.0030
; and
(b) the concessions given in this clause shall also apply in respect of the letters of credit opened or
foods declaration forms filed on or after the 23rd June, 2020. [Clause (12H) of Part IV of 2nd Schedule]
15. The provisions of section 148 shall not apply on import of 83 X Micron sprayers for Anti-Locust Operation
(Respective heading) by National Disaster Management Authority (NDMA). [Clause (12I) of Part IV of 2nd
Schedule]
16. The provisions of section 148 shall, in pursuance of the Cabinet Decision in case No. 34/02/2021, dated
12th January, 2021, not apply on import of three hundred thousand metric tons of wheat through
tendering process by the Trading Corporation of Pakistan. [Clause (12J) of Part IV of 2nd Schedule]
17. (a) The provisions of section 148 shall not apply on import of following goods by the manufacturers of
oxygen for a period of three months starting from the 25th day of December, 2020, namely:-
S. No. Description PCT Code
1 Clause (12C) inserted by Finance Act, 2020. Earlier it was inserted by SRO 287(I)/2020 dated April 07, 2020.
2 Clause (12D) inserted Finance Act, 2020. Earlier same was inserted by SRO 557(I)/2020 dated June 22, 2020.
3 Clause (12E) inserted Finance Act, 2020.
Page 26 of 166
(1) (2) (3)
1. Cryogenic Tanks (for oxygen Gas) 7311.0030
(b) the concessions given in this clause shall also apply in respect of the letters of credit opened or goods
forms filed on or after the 25th day of December, 2020. [Clause (12K) of Part IV of 2nd Schedule]
18. The provisions of section 148 and 153 shall not apply on import and subsequent supply of five hundred
thousand metric tons of white sugar imported by the Trading Corporation of Pakistan. [Clause (12L) of Part
IV of 2nd Schedule]
19. The provisions of section 148 shall not apply on import of following goods for a period of one hundred
and eighty days starting from the 14th day of May, 2021, namely:-
S.No. Description PCT Code
(1) (2) (3)
1. - Oxygen 2804.4000
2. - - - Other (Oxygen Cylinders) 7311.0090
3. - - - For Cryogenic (Tanks/Vessels) 7311.0030
4. Oxygen Concentrators/Generators/Manufacturing Plants of all Respective
specifications and capacities. headings
nd
[Clause (12M) of Part IV of 2 Schedule]
20.
21. The provisions of section 148, regarding withholding tax on imports shall not apply in respect of-
(i) goods classified under Pakistan Customs Tariff falling under Chapter 86 and 99 except PCT heading
9918;
(ia) Petroleum oils and oils obtained from bituminous minerals crude (PCT Code 2709.0000), Furnace-
oil (PCT Code 2710.1941), High speed diesel oil (PCT) Code 2710.1931), Motor spirit (PCT Code
2710.1210), J.P.1 (PCT Code 2710.1912), base oil for lubricating oil (PCT Code 2710.1993), Light
diesel oil (PCT Code 2710.1921) and Super Kerosene Oil imported by Pakistan State Oil Company
Limited, Shell Pakistan Limited, Attock Petroleum Limited, Byco Petroleum Pakistan Limited,
Admore Gas Private Limited, Chevron Pakistan Limited, Total- PARCO Pakistan(Private) Limited,
Hascol Petroleum Limited, Bakri Energy (Private) Limited, Overseas Oil Trading Company (Pvt) Ltd,
Gas and Oil Pakistan (Pvt) Ltd or any other oil marketing company licensed by Oil and Gas Regulatory
Authority(OGRA) and oil refineries;
(ii) goods imported by direct and indirect exporters covered under sub chapter 7 of Chapter XII of SRO
450(I)/2001 dated June 18, 2001;
(iii) goods temporarily imported into Pakistan for subsequent exportation and which are exempt from
customs duty and sales tax under Notification No. 492(I)/2009, dated the 13th June, 2009;
(iiia) Goods temporarily imported into Pakistan by international athletes which would be subsequently
taken back by them within one hundred and twenty days of temporary import;
(iv) Manufacturing Bond as prescribed under Chapter XV of Customs Rules, 2001 notified vide S.R.O.
450(I)/2001, dated June 18, 2001; and
(v) mineral oil imported by a manufacturer or formulator of pesticides which is exempt from customs-
duties under the customs Notification No. S.R.O. 857(I)/2008, dated the 16th August, 2008.
(vi) the Federal Government;
(vii) a Provincial Government;
(vii) a Local Government;
(ix) a foreign company and its associations whose majority share capital is held by a foreign government;
(x) a person who imports plant and machinery for execution of a contract with the Federal Government
or a provincial government or a local government and produces a certificate from that government;
(xi) companies importing high speed diesel oil, light diesel oil, high octane blending component or
kerosene oil, crude oil for refining and chemical used in refining thereof in respect of such imports;
and
(xii) Petroleum (E&P) companies covered under the Customs and Sales Tax Notification No.
S.R.O.678(I)/2004, dated the 7th August, 2004, except motor vehicles imported by such companies.
(xiii) Goods produced or manufactured and exported from Pakistan which are subsequently imported in
Pakistan within one year of their exportation, provided conditions of section 22 of the Customs Act,
1969 (IV of 1969) are complied with;
Page 27 of 166
(xiv) plant and machinery imported for setting up of a bagasse/biomass based cogeneration power project
qualifying for exemption under clause (132C) of Part-I of this Schedule.;
(xv) persons authorized under Export Facilitation Scheme 2021 notified by the Board with such scope,
conditions, limitation, restrictions and specification of goods.;
(xvi) motor vehicles upto 1000cc in CBU condition;
(xvii) Printed books excluding brochures, leaflets and similar printed matter, whether or not in single
sheets.(PCT code 49.01);
(xviii) Newspapers, journals and periodicals, whether or not illustrated or containing advertising material (PCT
code 49.02); and
(xix) blind talking mobile phones imported by blind persons as per rules issued by the Board (respective PCT
headings)[Clause (56) Part IV of 2nd Schedule]
22. Fully as well partly designed/assembled cypher devices, for use within the country as are verified by
Cabinet Division (NTISB) with reference to design, quality and quantity. [Clause (60) of Part IV of 2nd
Schedule]
23. The provisions of section 148 of the Income Tax Ordinance, 2001 shall not apply for import of plant, machinery
and equipment including dumpers and special purposes motor vehicles imported by the following for
construction of Sukkur-Multan section of Karachi-Peshawar motorway project and Karakorum Highway (KKH)
Phase-II (Thakot to Havellian Section) of CPEC project respectively:-
a. M/s China State Constrution Engineering Corporation Ltd. (M/s CSEC); and
b. M/s China communication Costruction Company (M/s CCCC).]
[Clause(60A), Part IV, 2nd Schedule]
24. The provisions of section 148 of the Income Tax Ordinance, 2001 (XLIX of 2001), shall not apply for import of
construction materials or goods up to a maximum of 10,898,000 million rupees imported by China State
Construction Engineering Corporation (M/s CSCEC) for construction of Sukkur-Multan section Karachi-
Peshawar Motorway project of National Highway Authority under CPEC. [Clause(60AA), Part IV, 2nd Schedule]
25. The provision of section 148 of the Income Tax Ordinance, 2001 shall not apply on import of Thirty-five (35)
Armoured and Security vehicles imported by or for Ministry of Foreign Affairs, Government of Pakistan meant
for security of visiting foreign dignitaries, Subject to the following conditions, namely:-
(i) that the vehicles imported under this clause shall only be used for the security purpose of foreign
dignitaries and will be parked in Central Pool of Cars (CPC) in the Cabinet Division for further use as and
when needed; and
(ii) that the importing Ministry at the time of import shall furnish an undertaking to the concerned Collector
of Customs to the extent of customs-dues exempted under this clause on consignment to consignment
basis binding themselves that the vehicles imported under this clause shall not be re-exported, sold or
otherwise disposed of without prior approval of the Board and in the manner prescribed thereof.
[Clause(60B), Part IV, 2nd Schedule]
26. The provision of section 148 of the Income Tax Ordinance, 2001 (XLIX of 2001) shall not apply on import of
equipmemt to be furnished or installed for Rail Based Mass Transit Projects in Lahore, Karachi, Peshawar and
Quetta under CPEC. [Clause(60C), Part IV, 2nd Schedule]
27. The provisions of section 148 shall not apply on import of fire fighting equipments by industrial undertakings
set up in the special economic zones established by the Federal Government. [Clause(60D), Part IV, 2nd
Schedule]
28. The provisions of section 148 shall not apply to the import of the capital equipment as defined in section 2 of
the Special Technology Zones Ordinance 2020 (XIII of 2020) by –
(a) zone developers as defined in section 2 of the Special Technology Zones Ordinance 2020 for
consumption in the special technology zones for the period of 10 years commencing from the date of
signing the development agreement;
(b) zone enterprises as defined in section 2 of the Special Technology Zones Authority Ordinance, 2020 for
a period of ten years from the date of issuance of license by the Special Technology Zone Authority;
and
(c) Special Technology Zones Authority established under the Special Technology Zones Ordinance 2020.
[Clause(60DA), Part IV, 2nd Schedule]
29. The provisions of section 148 shall not apply on mobile phones brought in personal baggage under the
Baggage Rules, 2006. [Clause(60E), Part IV, 2nd Schedule]
Page 28 of 166
30. Goods imported by foreign company and its associations whose majority share capital is held by a foreign
government. [SRO 947(I)/2008, 05-09-2008]
31. A person who imports plant, machinery, fixtures, fittings or its allied equipments for the purposes of setting
up an industrial undertaking (including hotels) owned by such person, or for installation of an existing
industrial undertaking (including hotels) owned by the person and a certificate to that effect from the
Commissioner of income tax, in respect of such plant, machinery, fixtures, fittings or equipments is produced.
[SRO 947(I)/2008, 05-09-2008]
32. A person who imports plant and machinery for execution of a contract with the Federal Government or a
provincial government or a local government and produces a certificate from that government [SRO
947(I)/2008, 05-09-2008]
33. Companies importing High-speed diesel oil, light diesel oil, high-octane blending component or kerosene oil
crude oil for refining and chemicals used in refining thereof in respect of such imports. [SRO 947(I)/2008, 05-
09-2008]
34. Import of petroleum (E&P) companies covered under the Customs and Sales Tax Notification SRO 678/2004
dated 7-08-2004, except motor vehicles imported by such companies.
35. Goods imported by Businessmen Hospital Trust, Lahore. [SRO 840(I)/79 dated September 12, 1979]
36. Goods temporarily imported into Pakistan for subsequent exportation which are exempt from Customs duty
and Sales Tax under Notification No. S.R.O 1065(I)/2005 dated 20th October 2005. [SRO 863(I)/2006 dated
22nd August 2006]
37. Import of goods or classes of goods for the execution of contract, imported by contractors and sub-
contractors engaged in the execution of power project under the agreement between the Islamic Republic of
Pakistan and HUB Power Company Limited. [SRO 129(I)/2009 dated 7th February 2009]
38. Import and subsequent supply of items with dedicated use of renewable sources of energy like solar and
wind etc., even if locally manufactured, which include induction lamps, SMD, LEDs with or without ballast
with fittings and fixtures, wind turbines including alternator and mast, solar torches, tubular daylighting
devices such as solatube, lanterns and related instruments, PV modules with or without related
components including invertors, charge controllers and batteries. [Clause(77), Part IV, 2nd Schedule]
39. The provisions of section 148 shall not apply to import of ships and other floating crafts including tugs, survey
vessels and other specialized crafts purchased or bare-boat chartered by a Pakistani entity and flying Pakistani
flag:
Provided that exemption under this clause shall be available up to the year 1[2030], subject to the
condition that the ships and crafts are used for the purpose for which they were procured, and in case such
ships and crafts are used for demolition purposes, tax collectible under section 148, applicable to ships and
crafts purchased for demolition purposes, shall be chargeable. [Clause (98), Part IV, 2nd Schedule]
40. The provisions of section 148 shall not apply to import or acquisition of aircraft on wet or dry lease by M/s
Pakistan International Airlines Corporation with effect from 19th March, 2015. [Clause (99), Part IV, 2nd
Schedule]
41. The provision of section 148 of the Income Tax Ordinance, 2001 (XLIX of 2001) shall not apply on import of
equipmemt to be furnished or installed for Rail Based Mass Transit Projects in Lahore, Karachi, Peshawar and
Quetta under CPEC. [Clause (60C), Part IV, 2nd Schedule]
42. The provision of section 148 of the Income Tax Ordinance, 2001 shall not apply on import of Thirty-five (35)
Armoured and Security vehicles imported by or for Ministry of Foreign Affairs, Government of Pakistan meant
for security of visiting foreign dignitaries, Subject to the following conditions, namely:-
(i) that the vehicles imported under this clause shall only be used for the security purpose of foreign
dignitaries and will be parked in Central Pool of Cars (CPC) in the Cabinet Division for further use as
and when needed; and
(ii) that the importing Ministry at the time of import shall furnish an undertaking to the concerned
Collector of Customs to the extent of customs-dues exempted under this clause on consignment to
consignment basis binding themselves that the vehicles imported under this clause shall not be re-
exported, sold or otherwise disposed of without prior approval of the Board and in the manner
prescribed thereof. [Clause (60B), Part IV, 2nd Schedule]
43. The provisions of section 148 of the Income Tax Ordinance, 2001 (XLIX of 2001), shall not apply for import of
construction materials or goods up to a maximum of 10,898,000 million rupees imported by China State
1 Figure “2020” substituted by Finance Act, 2020.

Page 29 of 166
Construction Engineering Corporation (M/s CSCEC) for construction of Sukkur-Multan section Karachi-
Peshawar Motorway project of National Highway Authority under CPEC. [Clause (60AA), Part IV, 2nd Schedule]
44. The provisions of section 148 shall not apply on import of fire fighting equipments by industrial undertakings
set up in the special economic zones established by the Federal Government. [Clause (60C), Part IV, 2nd
Schedule]
45. 1The provisions of section 148 shall not apply on mobile phones brought in personal baggage under the
Baggage Rules, 2006. [Clause (60E), Part IV, 2nd Schedule]
46. The provisions of section 148 shall not apply to--
(i) Tillage and seed bed preparation equipment as specified below
Equipment PCT Code
(i) Rotavator 8432.8010
(ii) Cultivator 8432.2910
(iii) Ridger 8432.8090
(iv) Sub soiler 8432.3900
(v) Rotary slasher 8432.8090
(vi) Chisel plow 8432.1010
(vii) Ditcher 8432.1090
(viii) Border disc 8432.2990
(ix) Disc harrow 8432.2100
(x) Bar harrow 8432.2990
(xi) Mould board plow 8432.1090
(xii) Tractor rear or
front blade 8430.6900
(xiii) Land leveller or
land planer 8430.6900
(xiv) Rotary tiller 8432.8090
(xv) Disc plow 8432.1090
(xvi) Soil-scrapper 8432.8090
(xvii) K.R.Karundi 8432.8090
(xviii) Tractor mounted
Trancher [8701.9200]
(xix) Land leveler 8430.6900
(ii) Seeding or planting equipment

Equipment PCT Code
(i) Seed-cum-fertilizer
drill (wheat, rice
barley, etc.) 8432.3100
(ii) Cotton or maize
planter with
fertilizer attachment 8432.3900
(iii) Potato planter 8432.3900
(iv) Fertilizer or
manure spreader
or broadcaster 8432.4100
(v) Rice transplanter 8432.3900
(vi) Canola or
sunflower drill 8432.3100
(vii) Sugarcane planter 8432.3900
(iii) Irrigation, drainage and agro-chemical application equipment

Equipment PCT Code
(i) Tu bewells filters or 8421.2100,
1 Clause (24C) inserted by Finance Act, 2019.

Page 30 of 166
Strainers 8421.9990
(ii) Kn apsack sprayers 8424.2010
(iii) G ranular applicator 8424.2010
(iv) Boom or field sprayers 8424.2010
(v) Self propelled sprayers 8424.2010
(vi) Orchard sprayer 8424.2010
(iv) Harvesting, threshing and storage equipment

Equipment PCT Code
(i) Wheat thresher 8433.5200
(ii) Maize or groundnut thresher
or sheller 8433.5200
(iii) Groundnut digger 8433.5900
(iv) Potato digger or harvester 8433.5300
(iv) Sunflower thresher 8433.5200
(v) Post hole digger 8433.5900
(vi) Straw balers 8433.4000
(vii) Fodder rake 8433.5900
(viii) Wheat or rice reaper 8433.5900
(ix) Chaff or fodder cutter 8433.5900
(x) Cotton picker 8433.5900
(xi) Onion or garlic harvester 8433.5200
(xii) Sugar harvester 8433.5200
(xiii) Tractor trolley or
forage wagon 8716.8090
(xiv) Reaping machines 8433.5900
(xv) Combined harvesters 8433.5100
(xvi) Pruner/shears 8433.5900
(xvii) Corn harvester/corn picker
and silage maker with their
respective PCT heading
(v) Post-harvest handling and processing & miscellaneous machinery

Equipment PCT Code
(i) Vegetables and fruits cleaning
and sorting or grading
equipment 8437.1000
(ii) Fodder and feed cube maker
Equipment 8433.40000
[Clause (91), Part IV, 2nd Schedule]
47. Through notification SRO 717(I)/2014, Dated: August 07, 2014. FBR prescribed the conditions and manner for
issuance of withholding tax exemption certificates to the industrial undertakings against import of raw
material for personal consumption in order to discourage misuse of these types of exemptions.
48. The provisions of section 148 shall not apply on the import of goods which takes place within the
jurisdiction of Border sustenance markets specified in Table below:-
Sr. # PCT Heading Description
1. 07011000 -SEED (Potatoes)
2. 07020000 TOMATOES, FRESH OR CHILLED
3. 07031000 -ONIONS AND SHALLOTS
4. 07032000 -GARLIC
5. -OTHERS which qualifies for exemption of concession or reduced rate
07049000 under the provisions of Custom Act, 1969 and Sales Tax Act, 1990 or
Federal Excise Act, 2005 for Border Sustenance Markets
6. 07061000 -CARROTS AND TURNIPS
7. 07070000 CUCUMBERS AND GHERKINS FRESH OR CHILLED
Page 31 of 166
8. 07081000 -PEAS (PISUM SATIVUM)
9. 07082000 -BEANS (VIGNA SPP. PHASEOLUS SPP)
10. 07089000 -OTHERS LEGUMINOUS VEGETABLES
11. 07131000 -Peas (Pisum sativum)
12. 07132010 Grams (Dry/Whole)
13. ---others- which qualifies for exemption or concession or reduced rate
14. --Beans of the species Vigna mungo (L.) Hepper or Vigna radiate (L.)
07133100
Wilczek
15. 07133200 --small red (Adzuki) beans (Phaseolus or Vigna angularis)
16. 07133300 Kidney beans including white beans
17. 07133400 --Bambara – vigna subteranea or vaahdzeia subterea
18. 07133500 - - Cow peas (Vigna unguiculata)
19. -- Other which qualifies for exemption or concession or reduced rate under
07133990 the provisions of Custom Act, 1969 and Sales Tax Act, 1990 or Federal
Excise Act, 2005 for Border Sustenance Markets
20. 07134010 - Lentils (Dry Whole)
21. - Broad beans (Vicia faba var, major) and horse beans (Vicia faba var,
07135000
equine, Vicia faba var, minor)
22. 07136000 - Pigeon peas (cajanus cajan)
23. - Other which qualifies for exemption or concession or reduced rate under
24. 09051000 Vanilla (Neither crushed not ground)
25. 09061100 Cinnamon
26. 09061900 Other (Cinnamon And Cinnamon Tree Flowers)
27. 09071000 - - Neither crushed nor ground (Cloves)
28. 09072000 - - Crushed or ground (Cloves)
29. 09081100 - - Neither crushed nor ground (Nutmeg)
30. 09081200 - - Crushed or ground (Nutmeg)
31. 09082100 - - Neither crushed nor ground (Maze)
32 09082200 - - Crushed or ground (Maze)
33. 09083110 - - - Large (Cardammoms)
34. 09083120 - - - Small (Cardammoms)
35. 09083200 - - Crushed or ground (Cardammoms)
36. 09092100 - - Neither crushed nor ground (Coriander)
37. 09092200 - - Crushed or ground (Coriander)
38. 09093100 - - Neither crushed nor ground (Seeds of Cumins)
39. 09093200 - - Crushed or ground (Seeds of Cumins)
40. - - Neither crushed nor ground (Seeds of Anise, Badian, Caraway, Fennel
09096100
etc)
41. 09096200 - - Crushed or ground (Seeds of Anise, Badian, Caraway, Fennel etc)
42. 09109910 - - - THYME; BAY LEAVES
43. 10031000 Barley (Seeds)
44. 10039000 Other (Barley)
45. 12060000 Sunflower seeds, whether or not broken
46. 12129200 Locust beans
47. 12130000 Cereal straws and husks
48. 15161000 Animals Fats and Oils and their fractions
49. 15162010 Vegetables Fats and their fractions
50. 15162020 Vegetables Oils and their fractions
51. 82089010 - - - Knives and cutting blades for paper and paper board
52. 04011000 - OF A FAT CONTENT, BY WEIGHT, NOT EXCEEDING 1% (Milk and Cream)
Page 32 of 166
53. - OF A FAT CONTENT, BY WEIGHT, EXCEEDING 1% BUT NOT EXCEEDING 6%
04012000
(Milk and Cream)
54. - Of a fat content, by weight, exceeding 6% but not exceeding 10% (Milk
04014000
and Cream)
55. 04015000 - Of a fat content, by weight, exceeding 10% (Milk and Cream)
56. 07039000 - LEEKS AND OTHER ALLIACEOUS VEGETABLES
57. 07041000 - CAULIFLOWERS AND HEADED BROCCOLI
58. 07042000 - BRUSSELS SPROUTS
59. 07051100 - - CABBAGE LETTUCE (HEAD LETTUCE)
60. - - Other which qualifies for exemption or concession or reduced rate
61. 07052100 - - WITLOOF CHICORY (CICHORIUM INTYBUS VAR. FOLIOSUM)
64. 07096000 Fruits Of the genus Capsicum or of the genus Pimenta
65. 08042000 Figs
66. 08061000 - FRESH (Grapes)
67. 08062000 - - DRIED (Grapes)
68. 08071100 - - WATERMELONS
69. - - OTHER which qualifies for exemption or concession or reduced rate
70. 08081000 - APPLES
71. 09021000 Green Tea
72. 09022000 Other Green Tea
73. 09101200 - - Crushed or ground (Ginger)
74. 09103000 - TURMERIC (CURCUMA)
75. - - - OTHER which qualifies for exemption or concession or reduced rate
76. 17021110 Lactose (Sugar)
77. 17021120 - - - Lactose syrup
79. 17029020 - - - CARAMEL
80. OIL-CAKE AND OTHER SOLID RESIDUES, WHETHER OR NOT GROUND OR IN
23040000 THE FORM OF PELLETS, RESULTING FROM THE EXTRACTION OF SOYA BEAN
OIL
81. 23099000 Other (animal feed)
82. 52042010 - - - FOR Sewing (Thread)
83. 52042020 For embroidery (Thread)
84. 82011000 - Spades and shovels
85. 82055900 Other (Tools for masons, watchmakers, miners and hand tools nes)
86. 82083000 - For kitchen appliances or for machines used by the food industry
88. 04031000 - YOGURT
Page 33 of 166
89. 07019000 Other (Potatoes)
90. 07104000 - Sweet corn
91. 07109000 - Mixtures of vegetables
92. 08041010 Fresh (Dates)
93. 08041020 Dried (Dates)
94. 08091000 - APRICOTS
95. 08092100 - - Sour cherries (Prunus cerasus)
97. 08093000 - PEACHES, INCLUDING NECTARINES
98. 08094000 - PLUMS AND SLOES
99. 08101000 Strawberries
100. 08105000 Kiwi Fruit
101. 09101100 - - Neither crushed nor ground (Ginger)
102. 10011900 Other (Durum wheat (excl. seed for sowing))
103. 10019900 Other (Wheat and meslin (excl. seed for sowing and durum wheat))
104. 11010010 Of Wheat (Flour)
105. 11010020 Of Meslin (Flour)
106. 19021920 - - -VERMACELLI
107. 19059000 Other (Packed Cake)
108. 20071000 Homogenised preparation
109. 20079100 Citrus Fruit
110. Other which qualifies for exemption or concession or reduced rate under
111. - ORGANIC SURFACE – ACTIVE PRODUCTS AND PREPARATIONS FOR
WASHING THE SKIN IN THE FORM OF LIQUID OR CREAM AND PUT UP FOR
34013000
RETAIL SALE, WHETHER OR NOT
CONTAINING SOAP
112. 34022000 - Preparations put up for retail sale
113. - - - -OTHER which qualifies for exemption or concession or reduced rate
114. 69111090 Others (Tableware and kitchenware of porcelain or china)
115. 69119000 Other (Household articles nes & toilet articles of porcelain or china)
116. Other (Glassware for table or kitchen purposes (excl. glass having a linear
70134900
c)
117. 70139900 Other (Glassware nes (other than that of 70.10 or 70.18))
118. 82159910 - - - Spoons
119. 82159990 Other (Tableware articles not in sets and not plated with precious metal)
120. 87120000 Bicycles and other cycles (including delivery tricycles), not motorized.
121. 96170010 - - - Vacuum flasks
The exemption under this clause shall be available on the import of goods subject to following
conditions, namely:-
(i) Such goods shall be supplied only within the limits of Border Sustenance Markets established in
cooperation with Iran and Afghanistan;
(ii) If the goods, on which exemption under this table has been availed, are bought outside the limits of
such markets, income tax shall be charged on the import value as per provisions of section 148 of this
Ordinance;
Page 34 of 166
(iii) Such items in case of import, shall be allowed clearance by the Customs Authorities subject to
furnishing of bank quarantee equal to the amount of income tax involved and the same shall be
released after presentation of consumption certificate issued by the Commissioner Inland Revenue
having jurisdiction;
(iv) The said exemption shall only be available to a person upon furnishing proof of having a functional
business premises located within limits of the Border Sustenance Markets; and
(v) Breach of any of the conditions specified herein shall attract relevant legal provisions of the
Ordinance, besides recovery of the amount of income tax along with default surcharge and penalties
involved.
[Clause (12N)(a), Part IV, 2nd Schedule]
Page 35 of 166
1[ ]
1 Section 148A omitted by Finance Act, 2020. Earlier it was:

148A. Tax on local purchase of cooking oil or vegetable ghee by certain persons.
(1) The manufacturers of cooking oil or vegetable ghee, or both, shall be chargeable to tax at the rate of two percent on
purchase of locally produced edible oil.
(2) The tax payable under sub-section (1) shall be final tax in respect of income accruing from locally produced edible oil.
Adjustable/ Final
Section Nature of Payment / Transaction Rate
/ Minimum
148A Tax on local purchase of cooking oil or vegetable ghee by certain persons
The manufacturers of cooking oil or vegetable ghee, or both, shall be chargeable to tax at the
rate of two percent on purchase of locally produced edible oil. 2% F
Page 36 of 166
Section 149 - Salary
(1) Every 1[person responsible for] paying salary to an employee shall, at the time of payment, deduct tax
from the amount paid at the employee’s average rate of tax computed at the rates specified in
Division I of Part I of the First Schedule on the estimated income of the employee chargeable under
the head “Salary” for the tax year in which the payment is made after making adjustment of tax
withheld from employee under other heads and tax credit admissible under section 61, 62, 63 and 64
during the tax year after obtaining documentary evidence, as may be necessary, for:
(i) tax withheld from the employee under this Ordinance during the tax year;
(ii) any excess deduction or deficiency arising out of any previous deduction; or
(iii) failure to make deduction during the year;
(2) The average rate of tax of an employee for a tax year for the purposes of sub-section (1) shall be
computed in accordance with the following formula, namely:-
A/B
where -
A is the tax that would be payable if the amount referred to in component B of the formula
were the employee’s taxable income for that year; and
B is the employee’s estimated income under the head “Salary” for that year.
(3) Notwithstanding anything contained in sub-sections (1) and (2), every person responsible for making
payment for directorship fee or fee after attending board meeting or such fee by whatever name
called, shall at the time of payment, deduct tax at the rate of twenty percent of the gross amount
payable.
(4) Tax deducted under sub-section (3) shall be adjustable.
WITHHOLDING TAX RATES

Adjustable /
Withholding
Section Nature of Payment / Transaction Rates Final /
Agent
Minimum
149 Salary Average A
Flying Allowance, Submarine Allowance 2.5% F
Every person
Payment under compulsory Monetization of
responsible
Transport Facility for Civil Servants BS-20 to BS-22 (as
5% for paying F
reduced by deduction of drivers salary) [SRO
salary
569(I)/2012, dated: May 26, 2012]
Directorship Fee 20% A
1 Substituted for “employer” by Finance Act, 2013.

Page 37 of 166
SALARY TAX RATES FOR TAX YEAR 2020 ONWARDS
S. No. Taxable Income Rate of tax
1. Where taxable income does not exceed Rs. 600,000 0%
Where taxable income exceeds Rs. 600,000 but does
2. not exceed Rs. 1,200,000 5% of the amount exceeding Rs. 600,000
Where taxable income exceeds Rs. 1,200,000 but Rs. 30,000 plus 10% of the amount
3. does not exceed Rs. 1,800,000 exceeding Rs. 1,200,000
Where taxable income exceeds Rs. 2,500,000 but Rs. 195,000 plus 17.5% of the amount
6. does not exceed Rs. 5,000,000 exceeding Rs.3,500,000
Where taxable income exceeds Rs. 5,000,000 but Rs. 670,000 plus 22.5% of the amount
7. does not exceed Rs.8,000,000 exceeding Rs. 5,000,000
Where taxable income exceeds Rs. 8,000,000 but Rs. 1,345,000 plus 25% of the amount
Where taxable income exceeds Rs. 12,000,000 but Rs. 2,345,000 plus 27.5% of the amount
Where taxable income exceeds Rs. 30,000,000 but Rs. 7,295,000 plus 30% of the amount
Where taxable income exceeds Rs. 50,000,000 but Rs. 13,295,000 plus 32.5% of the amount
Rs. 21,420,000 plus 35% of the amount
12. Where taxable income exceeds Rs.75,000,000 exceeding Rs. 75,000,000
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 149 - Salary)

1. Medical allowance upto 10% of the Basic Salary if medical facility or reimbursement of medical expenses
are not provided. [Clause (139) Part I, 2nd Schedule]
2. 1The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction
or collection of withholding tax which were not applicable prior to commencement of the Constitution
(Twenty-fifth Amendment) Act, 2018 (XXXVII of 2018) shall not apply to individual domiciled or company and
association of persons resident in the Tribal Areas forming part of the Provinces of Khyber Pakhtunkhwa and
Balochistan under paragraph (d) of Article 246 of the Constitution with effect from the 1st day of June, 2018
to the 30th day of June, 2023 (both days inclusive). [Clause (109A) Part IV, 2nd Schedule]
1 Clause (109A) inserted by Finance Act, 2019.

Page 38 of 166
Section 5 - Tax on dividends
(1) Subject to this Ordinance, a tax shall be imposed, at the rate specified in Division III of Part I of the
First Schedule, on every person who receives a dividend from a company or treated as dividend under
clause (19) of section 2.
(2) The tax imposed under sub-section (1) on a person who receives a dividend shall be computed by
applying the relevant rate of tax to the gross amount of the dividend.
(3) This section shall not apply to a dividend that is exempt from tax under this Ordinance.
Section 150 - Dividends
Every person paying a dividend shall deduct tax from the gross amount of the dividend paid 1[or collect tax
from the amount of dividend in specie], at the rate specified in Division I of Part III of the First Schedule.
Adjustable/
Withholding
Agent
Minimum
150 Dividend
(a) in case of dividend paid by Independent Power Producers
where such dividend is a pass through item under an
Implementation Agreement or Power Purchase Agreement
7.5% F
or Energy Purchase Agreement and is required to be
reimbursed by Central Power Purchasing Agency (CPPA-G) or
its predecessor or successor entity. Every Person
(b) mutual funds and cases other than those mentioned in
15% F
clauses (a) and (ba)
(ba) in case of a person receiving dividend from a company where
no tax is payable by such company, due to exemption of 25% F
income or carry forward of business losses
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 150 - DIVIDENDS)

1. The provisions of section 100B and rule 1 of the Tenth Schedule shall not apply to the extent of payment
of dividend to non-resident persons. [Clause (111A) of Part IV of 2nd Schedule]
2. Dividend paid to the Federal Government. [Section 49]
3. Dividend paid to a Provincial Government. [Section 49]
4. Dividend paid to a Local Authority. [Section 49]
5. The provisions of section 150 shall not apply to dividend paid to Transmission Line Projects under
Transmission Line Policy 2015. [Clause (12A) of Part IV of 2nd Schedule]
6. Dividend paid to a Venture Capital Company. [Clause (38A) of Part IV of 2nd Schedule]
7. Dividend paid to National Investment (Unit) Trust or a Collective Investment Scheme or a modaraba or
Approved Pension Fund or an Approved Income Payment Plan or a REIT Scheme or a Private Equity and
Venture Capital Fund or a recognized provident Fund or an approved superannuation fund or an approved
gratuity fund. [Clause (47B) of Part IV of 2nd Schedule]
8. Dividend paid to a shareholder who produces a certificate from the Commissioner to the effect that his
income during the tax year is exempt from tax under the Ordinance. [SRO 1236(I)/91 dated December 05,
1991]
9. Any income derived from inter-corporate dividend within the group companies entitled to group taxation
under section 59AA subject to the condition that return of the group has been filed for the tax year. [Clause
(103A), Part I, 2nd Schedule]

Page 39 of 166
10. Provisions of withholding tax under this ordinance shall not apply to a banking company as a recipient of the
amount on which tax is deductible. [Rule 5(2), 7th Schedule, ITO, 2001] No exemption Certificate is required.
[Circular # 2 of 2008]
11. If income of the company is exempt, the tax shall be withheld on payment of dividend. [C. No. 1(8)TP-
III/89/22-02-1993]
12. Payment made to the International Finance Corporation established under the International Finance
Corporation Act, 1956 (XXVIII of 1956). [Clause (67), Part IV, 2nd Schedule]
13. Inter-corporate dividend within the group companies entitled to group taxation and group relief under
section 59AA subject to the condition that the return of the group has been filed for the latest completed
tax year. [Clause (11B), Part IV, 2nd Schedule]
14. In case of a stock fund if dividend receipts of the fund are less than capital gains, the rate of tax deduction
shall be 12.5%. [Part III, Division I, 1st Schedule]
15. If a Developmental REIT Scheme with the object of development and construction of residential buildings is
set up by thirtieth day of June, 2018, rate of tax on dividend received by a person from such Developmental
REIT Scheme shall be reduced by fifty percent for three years from thirtieth day of June, 2018. [Part III,
Division I, 1st Schedule]
16. The provisions of section 150 shall not apply to China Overseas Ports Holding Company Limited, China
Overseas Ports Holding Company Pakistan (Private) Limited, Gwadar International Terminal Limited, Gwadar
Marine Services Limited and Gwadar Free Zone Company Limited for a period of twenty-three years. [Clause
(38AA), Part IV, 2nd Schedule]
17. The provisions of sections 150 and 151 shall not apply to SARMAYA-E-PAKISTAN LIMITED. [Clause (36D), Part
IV, 2nd Schedule]
19. 2The provisions of section 150 shall not apply to payment of dividend exempt under sub-section (7) of section
100D. [Sub-rule 2 of Rule 7, Eleventh Schedule].

2 Eleventh Schedule inserted by The Tax Laws (Amendment) Ordinance, 2020.
Page 40 of 166
1[ ]
1 Section 150A omitted by Finance Act, 2021. Shifted to Section 151.

150A. Return on Investment in Sukuks
Every special purpose vehicle, or a company, at the time of making payment of a return on investment in sukuks to a sukuk
holder shall deduct tax from the gross amount of return on investment at the rate specified in Division IB of Part III of the
First Schedule.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 150A - DIVIDENDS)
1. The provisions of sections 147, 150A, 151, 152, 231A, 231AA, 236A and 236K shall not apply to “The Second Pakistan International
Sukuk Company Limited and the Third Pakistan International Sukuk Company Limited”, as a payer.
2. The provisions of sections 147, 150A, 151, 152, 231A, 231AA, 236A and 236K shall not apply to “The second Pakistan international
Sukuk Company Limited” and the Third Pakistan International Sukuk Company Limited, as a payer.
3. The provisions of sections 147, 150A, 151, 155 and 236K shall not apply to “The second Pakistan international Sukuk Company
Limited” and the Third Pakistan International Sukuk Company Limited, as a recipient. [Clause (96), Part IV, 2nd Schedule]
4. 1The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction or collection of withholding
tax which were not applicable prior to commencement of the Constitution (Twenty-fifth Amendment) Act, 2018 (XXXVII of 2018) shall
not apply to individual domiciled or company and association of persons resident in the Tribal Areas forming part of the Provinces of
Khyber Pakhtunkhwa and Balochistan under paragraph (d) of Article 246 of the Constitution with effect from the 1st day of June, 2018
Page 41 of 166
Section 7B - Tax on profit on debt
(1) Subject to this Ordinance, a tax shall be imposed, at the rate specified in Division IIIA of Part I of the
First Schedule, on every person, other than a company, who receives a profit on debt from any person
mentioned in clauses (a) to (d) of sub-section (1) of section 151.
(2) The tax imposed under sub-section (1) on a person, other than a company, who receives a profit on
debt shall be computed by applying the relevant rate of tax to the gross amount of the profit on debt.
(3) This section shall not apply to a profit on debt that—
(a) is exempt from tax under this Ordinance; or
(b) exceeds 1[five] million Rupees
S. No Profit on Debt Rate of tax

1. Where profit on debt does not exceed Rs. 5,000,000 5%
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 7B – TAX ON PROFIT ON DEBT)

1. The tax imposed under Sections 5, 5A, 5AA, 6, 7, 7A and 7B shall be a final tax on the amount in respect of
which the tax is imposed and-
(a) such amount shall not be chargeable to tax under any head of income in computing the taxable income
of the person who derives it for any tax year;
(b) no deduction shall be allowable under this Ordinance for any expenditure incurred in deriving the
amount;
(c) the amount shall not be reduced by -
(i) any deductible allowance; or
(ii) the set off of any loss;
(d) the tax payable by a person under section 5, 5A, 5AA, 6, 7, 7A and 7B shall not be reduced by any tax
credits allowed under this Ordinance; and
(e) the liability of a person under section 5, 6, or 7 shall be discharged to the extent that –
(i) in the case of shipping and air transport income, the tax has been paid in accordance with section
143 or 144, as the case may be; or
(ii) in any other case, the tax payable has been deducted at source under Division III of Part V of
Chapter X. [Section 8]
2. The provisions of section 7B shall not apply to yield or profit on investment in Bahbood Saving Certificate or
Pensioner’s Benefit Account, provided that tax on the said yield or profit on debt is paid at the rates specified
in Division I of Part I of the First Schedule subject to clause (6) of Part III. [Clause (103), Part IV, 2nd Schedule]
1 Word “thirty six” substituted by Finance Act, 2021.

Page 42 of 166
Section 151 - Profit on debt
(1) Where -
(a) a person pays yield on an account, deposit or a certificate under the National Savings Scheme
or Post Office Savings Account;
(b) a banking company or financial institution pays any profit on a debt, being an account or
deposit maintained with the company or institution;
(c) the Federal Government, a Provincial Government or a Local Government pays to any person
profit on any security other than that referred to in clause (a) issued by such Government or
authority; or
(d) a banking company, a financial institution, a company referred to in sub-clauses (i) and (ii) of
clause (b) of sub-section (2) of section 80, or finance society pays any profit on any bond,
certificate, debenture, security or instrument of any kind (other than a loan agreement
between a borrower and a banking company or a development finance institution) to any
person other than financial institution,
the payer of the profit shall deduct tax at the rate specified in Division IA of Part III of the First Schedule
from the gross amount of the yield or profit paid as reduced by the amount of Zakat, if any, paid by
the recipient under the Zakat and Ushr Ordinance, 1980 (XVII of 1980), at the time the profit is paid
to the recipient.
1
(1A) Every special purpose vehicle or a company, at the time of making payment of a return on investment
in sukuks to a sukuk holder shall deduct tax from the gross amount of return on investment at the
rate specified in Division IB of Part III of the First Schedule.
(2) This section shall not apply to any profit on debt that is subject to sub-section (2) of section 152.
(3) Tax deductible under this section shall be minimum tax on the profit on debt arising to a taxpayer,
except where —
(a) taxpayer is a company; or
(b) profit on debt is taxable under section 7B.
Adjustable/
Section Nature of Payment / Transaction Rates Withholding Agent Final/
Minimum
151 Profit on Debt
a) Profits on DSC or National Saving Deposit
15% Every Person
certificates M
Banking Companies & (Adjustable
b) Profit on account or deposit 15%
Financial Institutions for:
Federal / Provincial Companies,
c) Government Securities etc. 15%
Government / Local Authority profit on
d) Profit to any person other than a financial debt u/s 7B
institution, or any bond, certificate, debenture, Banking company, financial & profit
security, or instrument of any kind (other than a 15% institution, company or exceeding
loan agreement between a borrower & a banking finance society 36 M)
company or a development finance institution)
e) Payment to non-resident having no PE [Clause
10% Every Person F
(5A), Part II, 2nd Sch.]
Sukuks
In case the sukuk-holder is a company 25% F

Page 43 of 166
In case the sukuk-holder is an individual or an
association of person, if the return on investment is 12.5%
more than one million Special purpose vehicle or a
In case the sukuk-holder is an individual and an company
association of person, if the return on investment is 10%
less than one million
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151 - PROFIT ON DEBT)

1. Yield or profit paid to the Federal Government. [Section 49 and SRO 594(I)/91 dated June 30, 1991]
2. Yield or profit paid to a Provincial Government. [Section 49 and SRO 594(I)/91 dated June 30, 1991]
3. Yield or profit paid to a Local Government. [Section 49 and SRO 594(I)/91 dated June 30, 1991]
4. Yield or profit paid to non-resident and such yield or profit is subject to withholding tax under section 152(2).
[Section 151(2)]
5. Yield or profit paid to persons whose income is exempt from tax and produces a certificate from the
Commissioner of an exemption from deduction of tax. [Section 159]
6. Yield or profit paid on investments in National Savings Schemes of the Directorate of National Savings that
were exempt from tax under the repealed Income Tax Ordinance, 1979 and where investment was made on
or before June 30, 2001. [Section 239(14)]
7. Yield or profit paid on Mahana Amadni Account of the Directorate of National Savings where the monthly
installment does not exceed Rs. 1000. [Section 239(14)]
8. Yield or profit paid to institutions of the Agha Khan Development Network (Pakistan) listed in Schedule 1 of
the Accord and Protocol dated November 13, 1994, executed between the Government of the Islamic
Republic of Pakistan and Agha Khan Development Network. [Clause (16) of Part IV of 2nd Schedule]
9. The provisions of sections 113 and 151 shall not apply to non residents, (excluding local branches or
subsidiaries or offices of foreign banks, companies, associations of persons or any other person operating in
Pakistan), in respect of their receipts from Pak rupees denominated Government and corporate securities
and redeemable capital, as defined in the Companies Act, 2017 (XIX of 2017), listed on a registered stock
exchange, where the investments are made exclusively from foreign exchange remitted into Pakistan through
a Special Convertible Rupee Account maintained with a bank in Pakistan. [Clause (19) of Part IV of 2nd
Schedule]
10. Yield or profit paid to National Investment (Unit) Trust or a Collective Investment Scheme or a modaraba or
Approved Pension Fund or an Approved Income Payment Plan or a REIT Scheme or a Private Equity and
Venture Capital Fund or a recognized provident Fund or an approved superannuation fund or an approved
gratuity fund. [Clause (47B) of Part IV of 2nd Schedule]
11. Yield or profit paid on investment in Behbood Savings Certificates or Pensioner’s Benefit Account. [Clause
(36A) of Part IV of 2nd Schedule]
12. The tax payable in respect of any amount paid as yield or profit on investment in Bahbood Savings Certificate
or Pensioners Benefit Account shall not exceed 10% of such profit. [Clause (6) of Part III of 2nd Schedule]
13. Yield or profit paid to a Special Purpose Vehicle for the purpose of securitization or issue of sukuks. [Clause
(38) of Part IV of 2nd Schedule]
14. Yield or profit paid to a Venture Capital Company. [Clause (38A) of Part IV of 2nd Schedule]
15. Yield or profit paid to a resident individual on investment made in Monthly Income Savings Account
Scheme of Directorate of National Savings, where monthly installment in an account does not exceed Rs.
1000. [Clause (59)(iv)(b) of Part IV of 2nd Schedule]
amount on which tax is deductible. [Rule 5(2), 7th Schedule, ITO, 2001] No exemption Certificate is required
Corporation Act, 1956(XXVIII of 1956) [Clause (67), Part IV, 2nd Schedule]
18. Payment made to the Pakistan Domestic Sukuk Company Ltd. [Clause (68), Part IV, 2nd Schedule]
19. The provisions of sections 147, 150A, 151, 152, 236A and 236K shall not apply to “The second Pakistan
international Sukuk Company Limited” and the Third Pakistan International Sukuk Company Limited, as a
payer. [Clause (95), Part IV, 2nd Schedule]
Page 44 of 166
20. The provisions of sections 147, 150A, 151, 155 and 236K shall not apply to “The second Pakistan
recipient. [Clause (96), Part IV, 2nd Schedule]
21. The provisions of sections 131 and 151 shall not apply to the Supreme Court of Pakistan – Diamer Bhasha &
Mohmand Dams – Fund. [Clause (108), Part IV, 2nd Schedule]
23. The provisions of section 151 shall not apply to The Prime Minister’s COVID-19 Pandemic Relief Fund-
2020. [Clause (116) Part IV, 2nd Schedule]
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(b) - PROFIT ON DEBT)

1. Profit on an account or deposit paid to the Federal Government. [Section 49 and SRO 594(I)/91 dated June
30, 1991].
2. Profit on an account or deposit paid to a Provincial Government. [Section 49 and SRO 594(I)/91 dated June
30, 1991].
3. Profit on an account or deposit paid to a Local Government. [Section 49 and SRO 594(I)/91 dated June 30,
1991].
4. Profit on an account or deposit paid to non-residents and such profit is subject to withholding tax under
section 152(2). [Section 151(2)].
5. Profit on an account or deposit paid to institutions of the Agha Khan Development Network (Pakistan) listed
in Schedule 1 of the Accord and Protocol dated November 13, 1994, executed between the Government of
the Islamic Republic of Pakistan and Agha Khan Development Network. [Clause (16) of Part IV of 2nd
Schedule].
6. Profit on an account or deposit paid to National Investment (Unit) Trust or a Collective Investment Scheme
or a modaraba or Approved Pension Fund or an Approved Income Payment Plan or a REIT Scheme or Private
Equity and Venture Capital Fund or a recognized provident Fund or an approved superannuation fund or an
approved gratuity fund. [Clause (47B) of Part IV of 2nd Schedule].
7. Profit on an account or deposit paid to a Special purpose Vehicle for the purpose of securitization. [Clause
(38) of Part IV of 2nd Schedule].
8. Profit on an account or deposit paid to a Venture Capital Company. [Clause (38A) of Part IV of 2nd Schedule].
9. Profit paid on an a foreign currency account or deposit maintained in accordance with Foreign Currency
Accounts Scheme introduced by the State Bank of Pakistan, by a citizen of Pakistan and a foreign national
residing abroad, foreign association of persons, a company registered and operating abroad and a foreign
national residing in Pakistan. [SRO 594(I)/91 dated June 30, 1991].
10. Profit paid on a rupee account or deposit held by a citizen of Pakistan residing abroad, where the deposit(s)
in the said account is/are made exclusively from foreign exchange remitted into the said account. [SRO
594(I)/91 dated June 30, 1991].
11. Profit on an account or deposit paid by a Pakistani bank to a foreign bank, approved by the Federal
Government for the purposes clause (84) of Part I of Second Schedule to the Income Tax Ordinance, 2001,
for such period as may be determined by the Federal Government:
Provided that-
(a) the profit is earned on deposits comprising of remittances from abroad held in a rupee
account opened with a Pakistani bank with the prior approval of the State Bank of Pakistan;
(b) the Pakistani bank maintaining the said rupee account holds 20 per cent or more of the equity
capital of the said foreign bank and the management of the latter vests in the Pakistani bank;
and
(c) the rate of profit chargeable on the said deposits does not exceed the rate of interest
chargeable on the deposits in the foreign currency accounts allowed to be opened with banks

Page 45 of 166
in Pakistan by the State Bank of Pakistan. [SRO 594(I)/91 dated June 30, 1991].
12. Profit on interbank deposit paid to a banking company by another banking company. [SRO 594(I)/91 dated
June 30, 1991].
16. Payment made to Asian Development Bank established under ADB Ordinance, 1971. [Clause (69), Part IV, 2nd
Schedule]
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(c) - PROFIT ON DEBT)

1. Profit on a Government or a local authority Security paid to the Federal Government. [Section 49 and SRO
594(I)/91 dated June 30, 1991].
2. Profit on a Government or a local authority Security paid to a provincial Government. [Section 49 and SRO
594(I)/91 dated June 30, 1991].
3. Profit on a Government or a local authority Security paid to a local authority. [Section 49 and SRO 594(I)/91
dated June 30, 1991].
4. Profit on a Government or a local authority Security paid to non-residents and such profit is subject to
withholding tax under section 152(2). [Section 151(2)].
5. Profit on a Government or a local authority Security paid to institutions of the Agha Khan Development
Network (Pakistan) listed in Schedule 1 of the Accord and Protocol dated November 13, 1994, executed
between the Government of the Islamic Republic of Pakistan and Agha Khan Development Network [Clause
(16) of Part IV of 2nd Schedule].
6. Profit on Pak rupee denominated Government Security paid to a non-resident, (excluding a local branch or
subsidiary or office of foreign bank, company, association of persons or any other person operating in
Pakistan), where the investment is exclusively made from foreign exchange remitted into Pakistan through a
Special Convertible Rupees Account maintained with a bank in Pakistan. [Clause (19) of Part IV of 2nd
Schedule].
7. Profit on a Government or a local authority Security paid to National Investment (Unit) Trust or a Collective
Investment Scheme or a modaraba or Approved Pension Fund or an Approved Income Payment Plan or a
REIT Scheme or a Private Equity and Venture Capital Fund or a recognized provident Fund or an approved
superannuation fund or an approved gratuity fund. [Clause (47B) of Part IV of 2nd Schedule]
8. Profit on a Government or a local authority Security paid to Special purpose Vehicle for the purpose of
securitization. [Clause (38) of Part IV of 2nd Schedule].
9. Profit on a Government or a local authority Security paid to a Venture Capital Company. [Clause (38A) of Part
IV of 2nd Schedule].
12. Payment made to the Pakistan Domestic Sukuk Company Ltd. [Clause 68, Part IV, 2nd Schedule]
Schedule]
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(d) - PROFIT ON DEBT)

1. Profit on bond, certificate, etc. paid to the Federal Government. [Section 49 and SRO 594(I)/91 dated June
30, 1991].
2. Profit on bond, certificate, etc. paid to Provincial Government. [Section 49 and SRO 594(I)/91 dated June 30,
1991].
3. Profit on bond, certificate, etc. paid to a local authority. [Section 49 and SRO 594(I)/91 dated June 30, 1991].
4. Profit on bond, certificate, etc. paid to a Financial Institution. [Section 151(1)(d)].
Page 46 of 166
5. Profit on bond, certificate, etc. paid to a banking company or a development financial institution under a loan
agreement by a borrower. [Section 151(1)(d)].
6. Profit on bond, certificate, etc. paid to non-residents and such profit is subject to withholding tax under
section 152(2). [Section 151(2)].
7. Profit on bond, certificate, etc. paid to a person whose income is exempt from tax and produces a certificate
from the Commissioner of an exemption from deduction of tax. [Section 159].
8. Profit on bond, certificate, etc. paid to institutions of the Agha Khan Development Network (Pakistan) listed
in Schedule 1 of the Accord and Protocol dated November 13, 1994, executed between the Government of
the Islamic Republic of Pakistan and Agha Khan Development Network. [Clause (16) of Part IV of 2nd Schedule]
9. Profit on Pak rupees denominated corporate securities and redeemable capital, as defined in the Companies
Ordinance, 1984, listed on a registered stock exchange paid to a non-resident, (excluding local branch or
subsidiary or office of foreign bank, company, association of persons or any other person operating in
Pakistan), where the investment is exclusively made from foreign exchange remitted into Pakistan through a
Special Convertible Rupees Account maintained with a bank in Pakistan. [Clause (19) of Part IV of 2nd
Schedule].
10. Profit on bond, certificate, etc. paid to National Investment (Unit) Trust or a Collective Investment Scheme or
a modaraba or Approved Pension Fund or an Approved Income Payment Plan or a REIT Scheme or a Private
11. Profit on bond, certificate, etc. paid to Special purpose Vehicle for the purpose of securitization. [Clause (38)
of Part IV of 2nd Schedule].
12. Profit on bond, certificate, etc. paid to a Venture Capital Company. [Clause (38A) of Part IV of 2nd Schedule].
13. Profit on Term Finance Certificate issued on, or after 1st July, 1999 to a company. [Clause (59)(i) of Part IV of
2nd Schedule].
14. Profit paid on Term Finance Certificate being the instrument of redeemable capital under the Companies Act,
2017 issued by Prime Minister’s Housing Development Company (Private) Limited. [Clause (59)(ii) of Part IV
of 2nd Schedule].
15. Profit on inter-bank deposits paid to a banking company by another banking company. [SRO 594(I)/91 dated
June 30, 1991].
Schedule]
20. Payment made to The ECO Trade and Development Bank. [Clause (71), Part IV, 2nd Schedule]
21. Coal Mining and Coal based Power Generation Projects in Sindh],- (i) the dividend income of the
shareholders of such a project shall be exempt from provisions of section 150 from the date of
commencement of business till 30 years from such date; and (ii) the payments made on account of sale
or supply of goods or providing or rendering of services during project construction and operations, shall
be exempt from the provisions of section 153. [Clause (78), Part IV, 2nd Schedule]
22. Inter-corporate profit on debt within the group companies entitled to group taxation and group relief
under section 59AA or section 59B subject to the condition that the return of the group has been filed for
the latest completed tax year. [Clause (11C), Part IV, 2nd Schedule]
23. The provisions of section 151 shall not apply to profit on debt paid on promissory notes and sales tax refund
bonds issued under the provisions of the Sales Tax Act, 1990. [Clause (36B), Part IV, 2nd Schedule]
24. The provisions of section 151 shall not apply to profit on debt paid on Pakistan Banao Certificate. [Clause
(36C), Part IV, 2nd Schedule]
25. The provisions of sections 150 and 151 shall not apply to SARMAYA-E-PAKISTAN LIMITED. [Clause (36D), Part
IV, 2nd Schedule]
26. The provisions of section 151 shall not apply on profit on debt paid on bonds issued under the Federal
Government Duty Drawback Bonds Rules, 2019. [Clause (36E), Part IV, 2nd Schedule]
Page 47 of 166
27. The provisions of section 151 and 153 shall not apply to the National Disaster Risk Management Fund.
[Clause (38D), Part IV, 2nd Schedule]
28. The rate of tax to be deducted under section 151 shall be ten percent from the profit on debt from a debt
instrument, whether conventional or Shariah compliant, issued by the Federal Government under the
Public Debt Act, 1944 (XVIII of 1944) or its wholly owned special purpose company, purchased by a
resident citizen of Pakistan who has already declared foreign assets to the Board through a Foreign
Currency Value Account (FCVA) maintained with authorized banks in Pakistan under the foreign exchange
regulation issued by the State Bank of Pakistan:
Provided that the tax so deducted shall be the final tax. [Clause (5AB), Part II, 2nd Schedule]
Section 6 - Tax on certain payments to non-residents

(1) Subject to this Ordinance, a tax shall be imposed, at the rate specified in Division IV of Part I of the
First Schedule, on every non-resident person who receives any Pakistan source royalty 1[, fee for
offshore digital services] or fee for technical services.
(2) The tax imposed under sub-section (1) on a non-resident person shall be computed by applying the
relevant rate of tax to the gross amount of the royalty or fee for technical services.
(3) This section shall not apply to –

(a) any royalty where the property or right giving rise to the royalty is effectively
connected with a permanent establishment in Pakistan of the non-resident person;
(b) any fee for technical services 2[fee for offshore digital services] where the services
giving rise to the fee are rendered through a permanent establishment in Pakistan of
the non- resident person; or
(c) any royalty or fee for technical services that is exempt from tax under this Ordinance.
(4) Any Pakistani-source royalty 3[, fee for offshore digital services] or fee for technical services received
by a non-resident person to which this section does not apply by virtue of clause (a) or (b) of sub-
section (3) shall be treated as income from business attributable to the permanent establishment in
Pakistan of the person.

Page 48 of 166
Section 152 - Payments to non-residents
(1) Every person paying an amount of royalty or fees for technical services to a non-resident
person that is chargeable to tax under section 6 shall deduct tax from the gross amount paid
at the rate specified in Division IV of Part I of the First Schedule.
(1A) Every person making a payment in full or part (including a payment by way of advance) to a
non-resident person on the execution of -
(a) a contract or sub-contract under a construction, assembly or installation project in
Pakistan, including a contract for the supply of supervisory activities in relation to such
project; or
(b) any other contract for construction or services rendered relating thereto; or
(c) a contract for advertisement services rendered by T.V. Satellite Channels,
shall deduct tax from the gross amount payable under the contract at the rate
specified in Division II of Part III of the First Schedule.
(1AA) Every person making a payment of insurance premium or reinsurance premium to a non-
resident person shall deduct tax from the gross amount paid at the rate specified in Division
II of Part III of the First Schedule;
1(1AAA) Every person making a payment for advertisement services to a non-resident media person
relaying from outside Pakistan shall deduct tax from the gross amount paid at the rate
specified in 2[Division II] of Part III of the First Schedule.
3(1B) The tax deductible under sub-section (1A), (1AA) and (1AAA) shall be a minimum tax on the
income of the non-resident persons in respect of payments mentioned therein.
(1BA) Every person responsible for making payment directly or through an agent or intermediary
to a non-resident person for foreign produced commercial for advertisement on any
television channel or any other media, shall deduct tax at the rate of twenty percent from the
gross amount paid. The tax deductible under this sub-section shall be final tax on the income
of non-resident person arising out of such payment.
4[(1C) Every banking company or a financial institution remitting outside Pakistan an amount of fee
for offshore digital services, chargeable to tax under section 6, to a non-resident person on
behalf of any resident or a permanent establishment of a nonresident in Pakistan shall deduct
tax from the gross amount paid at the rate specified in Division IV of Part I of the First
Schedule.]
5[(1D) Every banking company or a financial institution maintaining special convertible rupee
account (SCRA) of a non-resident company having no permanent establishment in Pakistan
shall deduct tax from capital gain arising on the disposal of debt instruments and Government
securities including treasury bills and Pakistan investment bonds invested through SCRA at
1 Sub-section (1AAA) inserted by Finance Act, 2012.

2 Words “Division IIIA” substituted by Finance Act, 2017.
3 Sub-section (1B), (1BB) and (1BBB) substituted by Finance Act, 2021.Earlier it was:
(1B) The tax deductible under sub-section (1A) shall be minimum tax on the income of a non-resident person arising from a
contract.
(1BB) The tax deductible under sub-section (1AA) shall be minimum tax on the income of the non-resident person arising out of
such payment.
(1BBB) The tax deductible under sub-section (1AAA) shall be minimum tax on the income of non-resident person arising out of such
payment.
4 Sub-section (1C) inserted by Finance Act, 2018.
5 Sub-section (1D) & (1E) inserted by The Tax Laws (Amendment) Act, 2020. Earlier it was inserted by The Tax Laws (Second
Amendment) Ordinance, 2019.
Page 49 of 166
the rate specified in Division II of Part III of the First Schedule.
1(1DA) Every banking company maintaining a Foreign Currency Value Account (FCVA) or a non-
resident Pakistani Rupee Value Account (NRVA) of a non-resident individual holding Pakistan
Origin Card (POC) or National ID Card for Overseas Pakistani (NICOP) or Computerized
National ID Card (CNIC) shall deduct tax from capital gain arising on the disposal of debt
instruments and government securities and certificates (including Shariah complaint variant)
invested through aforesaid accounts at the rate specified in Division II of Part III of the First
Schedule.
(1DB) Every special purpose vehicle or a company, at the time of making payment of a return on
investment in sukuks to a non-resident sukuk holder shall deduct tax from the gross amount
of return on investment at the rate specified in Division IB of Part III of the First Schedule.
2(1E) The tax deductible under sub-section (1D), (1DA) and (1DB) shall be a final tax in respect of
persons and income mentioned therein.
(2) Subject to sub-section (3), every person paying an amount to a non-resident person (other
than an amount to which sub-section (1) or sub-section (1A) 3[, (1AA), 4[(1AAA) 5[(1C)] or (2A)]
applies) shall deduct tax from the gross amount paid at the rate specified in Division II of Part
III of the First Schedule.
6(2A) Every prescribed person making a payment in full or part including a payment by way of
advance to a permanent establishment in Pakistan of a non-resident person-
7[(a)] for the sale of goods 8[except where the sale is made by the importer of the goods
and tax under section 148 in respect of such goods has been paid and the goods are
sold in the same condition as they were when imported];
[(b)] for the rendering of or providing services; and
[(c)] on the execution of a contract, other than a contract for the sale of goods or the
rendering of or providing services, shall, at the time of making the payment, deduct
tax from the gross amount payable (including sales tax, if any) at the rate specified in
Division II of Part III of the First Schedule.
(2AA) Sub-section (1AA) shall not apply to an amount, with the written approval of the
Commissioner, that is taxable to a permanent establishment in Pakistan of the non-resident
person.
9(2B) The tax deductible under sub-section (2A) shall be minimum tax:
Provided that tax deductible under clause (a) of sub-section (2A) shall not be minimum
tax where payments are received for sale of goods by a company being a manufacturer of
such goods.
(3) Sub-section (2) does not apply to an amount -
1 Sub-section (1DA) and (1DB) inserted by Finance Act, 2021.

2 Sub-section (1E) substituted by Finance Act, 2021. Earlier it was:
(1E) The tax deductible under sub-section (1D) shall be a final tax on the income of the non-resident company arising out of such
capital gain.
3 Figure inserted by Finance Act, 2010.
4 Words & figure inserted by Finance Act, 2012.
5 Words (1C) inserted by Finance Act, 2019.
7 Clauses re-numbered by Finance Act, 2017. Earlier it was “(i), (ii) and (iii)”.
9 Sub-section (2B) substituted by Finance Act, 2020. Earlier it was:
(2B) The tax deductible under clause (b) of sub-section (2A) shall be a minimum tax and the provisions of sub-clauses (i), (ii) and
(iii) of clause (b) of sub-section (3) [ ] of section 153 shall mutatis mutandis apply.
Page 50 of 166
(a) that is subject to deduction of tax under section 149, 150, 1[ ] 2[ ]156 or 233;
(b) with the written approval of the Commissioner, that is taxable to a permanent
establishment in Pakistan of the non-resident person;
(c) that is payable by a person who is liable to pay tax on the amount as representative
of the non-resident person under sub-section (3) of section 172; or
(d) where the non-resident person is not chargeable to tax in respect of the amount.
(4) Where a person claims to be a representative of a non-resident person for the purposes of
clause (c) of sub-section (3), the person shall file a declaration to that effect with the
Commissioner prior to making any payment to the non-resident person.
3(4A) The Commissioner may, on application made 4[in the prescribed form] by the recipient of
payment referred to in sub-section (1A) having permanent establishment in Pakistan, or by a
recipient of payment referred to in sub-section (2A), as the case may be, and after making
such inquiry as the Commissioner thinks fit, allow by order in writing, in cases where the tax
deductable under sub-section (1) or sub-section (2A) is 5[not minimum tax], any person to
make the payment without deduction of tax or deduction of tax at a reduced rate.
6(4B) The Commissioner may, in case of payment that constitutes part of an overall arrangement
of a cohesive business operation as referred to in paragraph (ii) of sub-clause (g) of clause
(41) of section 2, on application made by the person making payment and after making such
inquiry, as the Commissioner thinks fit, allow by order in writing, the person to make payment
after deduction of tax equal to 7[twenty] percent of the tax chargeable on such payment
under sub-section (1A):
Provided that the credit of the tax so deducted shall be available to the permanent
establishment of the non-resident accounting for overall profits arising on the overall
cohesive business operation.]
(5) Where a person intends to make a payment to a non-resident person without deduction of
tax under this section, other than payments liable to reduced rate under relevant agreement
for avoidance of double taxation, the person shall, before making the payment, furnish to the
Commissioner a notice in writing setting out -
(a) the name and address of the non-resident person; 8[ ]
(b) the nature and amount of the payment9[; and
(c) such other particulars as may be prescribed.]
(5A) The Commissioner on receipt of notice shall, within thirty days, pass an order accepting the
contention or making the order under sub-section (6).
(6) Where a person has notified the Commissioner of a payment under sub-section (5) and the
Commissioner has reasonable grounds to believe that the non-resident person is chargeable
1 Figure “153” omitted by Finance Act, 2012.

2 Figure and comma “155,” omitted by Finance Act, 2013.
3 Sub-section (4A) substituted by Finance Act, 2017. Earlier it was inserted by Finance Act, 2015:
(4A) The Commissioner may, on application made by the recipient of a payment referred to in sub-section (2A) and after making
such inquiry as the Commissioner thinks fit, may allow in cases where the tax deductible under sub-section (2A) is adjustable,
by order in writing, any person to make the payment, without deduction of tax or deduction of tax at a reduced rate.
5 Words “adjustable” substituted by Finance Act, 2019.
6 Sub-section (4B) inserted by Finance Act, 2019.
7 Words “thirty” substituted by Finance Act, 2020.
8 Words “and” omitted by Finance Act, 2020.
9 Words “and” & clause (c) inserted by Finance Act, 2020.
Page 51 of 166
to tax under this Ordinance in respect of the payment, the Commissioner may, by order in
writing, direct the person making the payment to deduct tax from the payment in accordance
with sub section (2).
(7) Sub-section (5) shall not apply to a payment on account of -
1[(a) an import of goods where title to the goods passes outside Pakistan and is supported
by import documents, except where —
(i) the supply is made in connection with the overall arrangement for the supply
of goods, installation, construction, assembly, commission, guarantees or
supervisory activities and all or principal activities are undertaken or
performed either by the associates of the person supplying the goods or its
permanent establishment, whether or not the title passes outside Pakistan
and whether or not the goods are imported in the name of the associate or
any other person; or
(ii) the supply is made by a resident person or a Pakistan permanent
establishment of a non-resident person in connection with the overall
arrangement as referred to in sub-clause (i); or]
(b) educational and medical expenses remitted in accordance with the regulations of the
State Bank of Pakistan.
2(8) In this section “prescribed person” means a prescribed person as defined in sub-section (7)
of section 153.
WITHHOLDING TAX RATES (Partially double rates applicable on persons not appearing in the ATL)
Adjustable/
Withholding
Section Nature of Payment / Transaction Rate Final/
Agent
Minimum
152 Payment to non-resident
Royalties or fee for technical services Every
(1) 15% 30% F
Person
Every
Banking
(1C) Fee for offshore digital service 5% Company / F
Financial
Institution
Execution of contract or sub contract under a
construction, assembly or installation project
in Pakistan including a contract for supply of Every
(1A) 7% M
supervisory activities relating to such project; Person
or any other contract for construction or
services rendered relating thereto; or
1 Clause (a) substituted by Finance Act, 2018. Earlier it was:

(a) an import of goods where title to the goods passes outside Pakistan and is supported by import documents, except an import that is
part of an overall arrangement for the supply of goods, their installation, and any commission and guarantees in respect of the
supply where -
(i) the supply is made by the head office outside Pakistan of a person to a permanent establishment of the person in
Pakistan;
(ii) the supply is made by a permanent establishment of the person outside Pakistan to a permanent establishment of the
person in Pakistan;
(iii) the supply is made between associates; or
(iv) the supply is made by a resident person or a Pakistan permanent establishment of a non-resident person; or
2 Sub-section (8) inserted by Finance Act, 2013.
Page 52 of 166
Contract for advertisement services
(1A) 5% M
rendered by TV satellite channels
Payment of insurance or re-insurance Every
(1AA) 7% 14% M
premium other than PE of non-resident Person
Every banking company or a financial
institution maintaining special convertible
rupee account (SCRA) of a non-resident Every
company having no permanent Banking
(1D) establishment in Pakistan shall deduct tax 10% Company / F
from capital gain arising on the disposal of Financial
debt instruments and Government securities Institution
including treasury bills and Pakistan
investment bonds invested through SCRA.
Other than royalty, fee for technical services,
salary, dividend, rent, winnings and prizes,
commission, brokerage, taxable in the hands
Every
(2) of PE of Non-resident, payable by a person 20% 40% A
Person
who is liable to pay tax as representative of
the non-resident and exempt for non-
resident
Profit on debt payable to a non-resident
person, having no permanent establishment
in Pakistan.
Provided that tax deducted on profit
on debt from debt instrument, Government
securities including treasury bills and
Pakistan Investment Bonds shall be final tax 10% F
on profit on debt payable to a non-resident
person having no permanent establishment
in Pakistan and the investments are
exclusively made through a special Rupp
Convertible Account maintained with a Bank
in Pakistan. [Clause 5A, Part II, 2nd Schedule]
1Profit on debt earned from a debt
instrument, whether conventional or shariah

compliant, issued by the Federal
Government under the Public Debt Act, 1944
and purchased exclusively through a bank
10% F
account maintained abroad, a non-resident
Rupee account repatriable (NRAR) or a
foreign currency account maintained with a
banking company in Pakistan. [Clause 5AA,
Part II, 2nd Schedule]
(2A) Full or partial payment to PE of non-resident on account of:
Supplies M
Every
(2A)(a) -Companies (manufacturer cum supplier) 4% (Adjustable
person
-Other than companies 4.5% for sale of
- in the cases of transport services, freight goods by a
forwarding services, air cargo services, company
courier services, manpower outsourcing Every being a
(2A)(b) 3% 6%
services, hotel services, security guard person manufacturer
services, software development services, IT of such
services and IT enabled services as defined in goods)
1 Clause (5AA) inserted by Finance Act, 2020.

Page 53 of 166
clause (133) of Part I of the Second Schedule,
tracking services, advertising services (other
than by print or electronic media), share
registrar services, engineering services, car
rental services, building maintenance
services, services rendered by Pakistan Stock
Exchange Limited and Pakistan Mercantile
Exchange Limited inspection and
certification, testing and training services;
in cases other than transport
Every
(2A)(b) - Company 8% 16%
person
- Other than Company 10% 20%
Contract
Every
(2A)(c) - Sports Persons 10% 20%
person
- Others 7% 14%
Payment to non-resident media person:
Payment for advertisement services to a non- Every
(1AAA) 10% M
resident media person relaying from outside Person
Pakistan
Page 54 of 166
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 152 - PAYMENT TO NON-RESIDENTS)
1. Salary paid that is covered under section 149. [Section 152(3)(a)].
2. Dividend paid that is covered under section 150. [Section 152(3)(a)].
3. Prize on prize bond, or winnings from a raffle, lottery, or crossword puzzle that is covered by section 156.
[Section 152(3)(a)].
4. The provisions of sub-section (2) of section 152 shall not apply in respect of payments to foreign news
agencies, syndicate services and non-resident contributors, who have no permanent establishment in
Pakistan.
5. Commission and brokerage that is covered by section 233. [Section 152(3)(a)].
6. Payment that is taxable in the hands of a permanent establishment in Pakistan, with the written approval of
the Commissioner. [Section 152(3)(b)].
7. Payment made by the person who is liable to pay tax thereon as a representative of the non-resident provided
a declaration to this effect is filed with the Commissioner prior to making the payment [Sections 152(3)(c) and
152(4)].
8. Payment that is not chargeable to tax subject to a notice in writing to the Commissioner to this effect
indicating the name and address of the payee and the nature and amount of payment. The Commissioner on
receipt of the notice shall pass an order accepting the contention or directing to deduct the tax. This
exemption shall not apply if the Commissioner directs otherwise. [Sections 152(3)(d), 152(5), 152(5A) and
152(6)].
No notice to the Commissioner is required for payment on account of:
- Import of goods where the title to the goods passes outside Pakistan (certain restrictions apply) [Sections
152(7)].
- Educational and medical expenses remitted in accordance with the regulations of the State Bank of
Pakistan [Sections 152(7)]
9. The rate of tax to be deducted under sub-section (2) of section 152, in respect of payments from profit on
debt payable to a non-resident person having no permanent establishment in Pakistan, shall be 10% of the
gross amount paid.
Provided that tax deducted on profit on debt from debt instrument, Government securities including
treasury bills and Pakistan Investment Bonds shall be final tax on profit on debt payable to a non-resident
person having no permanent establishment in Pakistan and the investments are exclusively made through a
special Rupee Convertible Account maintained with a Bank in Pakistan. [Clause (5A), Part II, 2nd Schedule]
10. 1The rate of tax to be deducted under sub-section (2) of section 152, in respect of payments to an
individual, on account of profit on debt earned from a debt instrument, whether conventional or shariah
compliant, issued by the Federal Government under the Public Debt Act, 1944 and purchased exclusively
through a bank account maintained abroad, a non-resident Rupee account repatriable (NRAR) or a foreign
currency account maintained with a banking company in Pakistan shall be ten percent of the gross amount
paid:
Provided that tax deducted on such profit on debt shall be final tax. [Clause (5AA), Part II, 2nd Schedule]
Corporation Act, 1956(XXVIII of 1956) [Clause 67, Part IV, 2nd Schedule]
12. Payment made to Asian Development Bank established under ADB Ordinance, 1971. [Clause 69, Part IV, 2nd
Schedule]
13. The provisions of section 152 shall not apply in case of a Hajj Group Operator in respect of Hajj operations.
[Clause (72AA) of Part IV of 2nd Schedule]
14. The payments made on account of sale or supply of goods or providing or rendering of services during project
construction and operations, shall be exempt from the provisions of section 152(2A) and section 153.] [Clause
(78)(ii), Part IV of 2nd Schedule].
1 Clause (5AA) inserted by Finance Act, 2020.

Page 55 of 166
17. The rate of tax to be deducted under sub-section (2) of section 152 or under section 151, as the case may be,
shall be zero percent of the gross amount of profit on debt paid, covered under clauses (78) and (79) of Part
I of the Second Schedule. [Clause (5AC), Part II, 2nd Schedule]
Page 56 of 166
1
[]
1 Section 152A omitted by Finance Act, 2021.

152A. Payment for foreign produced commercials
(1) Every person responsible for making payment directly or through an agent or intermediary to a nonresident person for foreign
produced commercial for advertisement on any television channel or any other media shall deduct tax at the rate of twenty
percent from the gross amount paid.
(2) The tax deductable under sub-section (1), shall be final tax on the income of non-resident person arising out of such payment.
Adjustable/
Section Nature of Payment / Transaction Rate Withholding Agent Final/
Minimum
152A Payment for foreign produced commercials
Every person responsible for making payment directly or through an
agent or intermediary to a non-resident person for foreign produced
20% Every Person F
commercial for advertisement on any television channel or any
other media.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 152A - PAYMENT FOR FOREIGN PRODUCED COMMERCIALS)
1. The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction or collection of withholding
Page 57 of 166
Section 153 - Payments for goods, services and contracts
(1) Every prescribed person making a payment in full or part including a payment by way of advance to a
resident person—
(a) for the sale of goods 1[including toll manufacturing] 2[except where payment is less than
seventy-five thousand Rupees in aggregate, during a financial year];
(b) for the rendering of or providing of services 3[except where payment is less than thirty
thousand Rupees in aggregate, during a financial year];
(c) on the execution of a contract including contract signed by a sportsperson, but not including
a contract for the sale of goods or the rendering of or providing of services, shall, at the time
of making the payment, deduct tax from the gross amount payable (including sales tax, if any)
at the rate specified in Division III of Part III of the First Schedule:
Provided that where the recipient of the payment under clause (b) receives the payment
through an agent or any other third person and the agent or, as the case may be, the third person
retains service charges or fee, by whatever name called, from the payment remitted to the recipient,
the agent or the third person shall be treated to have been paid the service charges or fee by the
recipient and the recipient shall collect tax along with the payment received.
(2) Every exporter or an export house making a payment in full or part including a payment by way of
advance to a resident person or permanent establishment in Pakistan of a non-resident person for
rendering of or providing of services of stitching, dying, printing, embroidery, washing, sizing and
weaving, shall at the time of making the payment, deduct tax from the gross amount payable at the
rate specified in Division IV of Part III of the First Schedule.
(3) The tax deductible under 4[ ] sub-section (1) and under sub-section (2) of this section, on the income
of a resident person or, shall be 5[minimum] tax.
Provided that,-
(a) tax deducted under clause (a) of sub-section (1) shall 6[not be minimum tax] where payment
are received on sale or supply of goods, by a, -
(i) company being a manufacturer of such goods; or
(ii) public company listed on a registered stock exchange in Pakistan;
7
[]
(c) tax deducted under clause (c) of sub-section (1) shall be adjustable if payment are received
by a public company listed on a registered stock exchange in Pakistan, on account of execution
of contracts;
8
[]
(4) The Commissioner may, on application made by the recipient of a payment referred to in sub-section
(1) and after making such inquiry as the Commissioner thinks fit, may allow in cases where tax
deductible under sub-section (1) is 9[not minimum tax], by an order in writing, any person to make

4 Words “clauses (a) and (c) of” omitted by Finance Act, 2020.
5 Words “a final” substituted by Finance Act, 2019.
6 Words “be adjustable” substituted by Finance Act, 2019.
(b) tax deductible shall be a minimum tax on transactions referred to in clause (b) of sub- section (1).
8 Clause (d) and (e) omitted by Finance Act, 2020. Earlier it was:
(d) tax deducted under clause (c) of sub-section (1) in respect of a sportsperson shall be minimum tax; and
(e) tax deducted under clause (b) of sub-section (1) by person making payments to electronic and print media for advertising
services shall be minimum tax.
9 Words “adjustable” substituted by Finance Act, 2019.
Page 58 of 166
the payment,-
(a) without deduction of tax; or
(b) deduction of tax at a reduced rate1[:
Provided that the Commissioner shall issue certificate for payment under clause (a) of sub-
section (1) without deduction of tax within fifteen days of filing of application to a 2[company] if
advance tax liability has been discharged:
Provided further that the Commissioner shall be deemed to have issued the exemption
certificate upon the expiry of fifteen days to the aforesaid 3[ ] company and the certificate shall be
automatically processed and issued by Iris:
Provided also that the Commissioner may modify or cancel the certificate issued
automatically by Iris on the basis of reasons to be recorded in writing after providing an opportunity
of being heard.]
4
[]
(5) Sub-section (1) shall not apply to -
(a) a sale of goods where the sale is made by the importer of the goods and tax under section
148 in respect of such goods has been paid and the goods are sold in the same condition as
they were when imported;
5
[]
(c) a refund of any security deposit;
(d) a payment made by the Federal Government, a Provincial Government or a Local Government
to a contractor for construction materials supplied to the contractor by the said Government
or the authority;
6
[]
(f) the purchase of an asset under a lease and buy back agreement by a modaraba, leasing
company, banking company or financial institution; or
(g) any payment for securitization of receivables 7[or issuance of sukuks] by a Special Purpose
Vehicle to the Originator.
(6) Where any tax is deducted by a person making a payment for a Special Purpose Vehicle, on behalf of
the Originator, the tax is credited to the Originator.
(7) In this section, -
(i) “prescribed person” means,-
(a) the Federal Government;
1 Colon and provisos inserted by Finance Act, 2020.

2 Words “public company listed on a registered stock exchange in Pakistan” substituted by Finance Act, 2021.
3 Words “public listed” omitted by Finance Act, 2021.
4 Sub-section (4A) omitted by Finance Act, 2019. Earlier it was:
(4A) The Commissioner, on the application made by the recipient of a payment referred to in clause (94) of Part IV of the Second
Schedule, in cases where the said recipient has fulfilled the conditions as specified in the said clause, by an order in writing
for a period of at least three months, may allow any person to make the payment without deduction of tax in respect of
payments as referred to in clauses (b) of sub-section (1) of section 153: (omitted)
Provided that the recipient of the payment has made advance payment of tax equal to two percent of the total
turnover of the corresponding period of the immediately preceding tax year.
(b) payments made to traders of yarn by the taxpayers specified in the zero-rated regime of sales tax (as provided under clause
(45A) of Part-IV of the Second Schedule);
6 Clause (e) omitted by Finance Act, 2016. Earlier it was:
(e) a cotton ginner who deposits in the Government Treasury, an amount equal to the amount of tax deductible on the payment
being made to him, and evidence to this effect is provided to the “prescribed person”;
7 Words” or issuance of sukuks” inserted by Tax Laws (Amendment) Ordinance, 2016.
Page 59 of 166
(b) a company ;
(c) an association of persons constituted by, or under, law;
(d) a non-profit organization;
(e) a foreign contractor or consultant;
(f) a consortium or joint venture;
(g) an exporter or an export house for the purpose of sub-section (2);
(h) an association of persons, having turnover of 1[one hundred] million rupees or above
in 2[any of the preceding tax years]; 3[ ]
(i) an individual, having turnover of 4[one hundred] million rupees or above in 5[any of
the preceding tax years]; 6[ ]
7
[(j) a person registered under the Sales Tax Act, 1990 8[having turnover of one hundred
million rupees or more in any of the preceding tax years]; 9[or]
10
[(k) a person deriving income from the business of construction and sale of residential,
commercial or other buildings (builder); or
(l) a person deriving income from the business of development and sale of residential,
commercial or other plots (developer).]
(ii) “services” includes the services of accountants, architects, dentists, doctors, engineers, interior
decorators and lawyers, otherwise than as an employee;
(iii) “sale of goods” includes a sale of goods for cash or on credit, whether under written contract
or not;
(iv) “manufacturer” means a person who is engaged in production or manufacturing of goods,
which includes-
(a) any process in which an article singly or in combination with other articles, material,
components, is either converted into another distinct article or product is so changed,
transferred, or reshaped that it becomes capable of being put to use differently or
distinctly; or
(b) a process of assembling, mixing, cutting or preparation of goods in any other manner;
and
(v) “turnover” means,-
(a) the gross sales or gross receipts, inclusive of sales tax and federal excise duty or any
trade discounts shown on invoices, or bills, derived from the sale of goods;
(b) the gross fees for the rendering of services for giving benefits including commissions;
(c) the gross receipts from the execution of contracts; and
(d) the company’s share of the amounts stated above of any association of persons of
which the company is a member.
1 Word “fifty” substituted by Finance Act, 2020.

2 Words “tax year 2007 or in any subsequent tax year” substituted by Finance Act, 2018.
3 Word “or” omitted by Finance Act, 2013.
4 Word “fifty” substituted by Finance Act, 2020.
5 Words “the tax year 2009 or in any subsequent year” substituted by Finance Act, 2018.
6 Word “or” omitted by Finance Act, 2018.
7 Sub-clause (j) inserted by Finance Act, 2013.
9 Word “or” inserted by Finance Act, 2018.
10 Sub-clause (k) & (l) inserted by Finance Act, 2018.
Page 60 of 166
Adjustable /
Withholding
Sec. Nature of Payment / Transaction Rates Final /
Agent
Minimum
153 Payment for goods, services and contracts
Payments to resident persons for:
153(1)(a) Sales of goods Federal
Sale of rice, cotton seed or edible oil 1.5% Govt., M (A for
1
Sale of any other goods including [including toll manufacturing] manufacturer
4% cum supplier
in case of Company,
4.5% companies
- Company and public
- Other taxpayers AOP companies)
153(1)(b) Rendering of services: constituted
2
in the cases of: under the
• transport services law,
• freight forwarding services
• air cargo services NPO,
• courier services
• manpower outsourcing services Foreign
• hotel services, security guard services contractor or
• software development services consultant,
• IT services and IT enabled services as defined in section 2
• tracking services Consortium
• advertising services (other than by print or electronic or Joint
media) Venture,
• share registrar services
• engineering services including architectural services AOP &
• warehousing services Individual
• services rendered by asset management companies having
• data services provided under license issued by the 3% turnover of M
Pakistan Telecommunication Authority Rs. 100m or
• telecommunication infrastructure (tower) services above,
• car rental services
• building maintenance services Person
• services rendered by Pakistan Stock Exchange Limited and registered
Pakistan Mercantile Exchange Limited under the
• inspection, certification, testing and training services Sales Tax
• oilfield services Act, 1990
• telecommunication services having
• collateral management services turnover of
• travel and tour services. Rs. 100m or
above,
Explanation:- The tax rate under this sub-paragraph shall be
applicable only to a services provider whose services are subjected Builders,
to withholding tax on gross receipts and the service provider has
not agitated taxation of gross receipts before any court of law. Developers

2 Sub-para (i) substituted by Finance Act, 2021. Earlier it was:
(i) 3% of the gross amount payable, in the cases of transport services, freight forwarding services, air cargo services, courier services,
manpower outsourcing services, hotel services, security guard services, software development services, IT services and IT enabled
services as defined in clause (133) of Part I of the Second Schedule, tracking services, advertising services (other than by print or
electronic media), share registrar services, engineering services, warehousing services, services rendered by asset management
companies, data services provided under license issued by the Pakistan Telecommunication Authority, telecommunication
infrastructure (tower) services,] car rental services, building maintenance services, services rendered by Pakistan Stock Exchange
Limited and Pakistan Mercantile Exchange Limited, inspection, certification, testing and training services
Page 61 of 166
* Other services rendered or provided in case
- Company 8% M
- Other taxpayers 10% M
* Print & Electronic Media Services (Company & Other taxpayers): 1.5% M
153(1)(c) Execution of contracts:
Other than a contractor for the supply of goods or rendering or
providing of services in case, M
1
- Company [6.5%] (A for public
2 companies)
- other taxpayers [7%]
In case of contract payment to sportsperson 10% M
(a) The tax in respect of income from services rendered outside Pakistan and construction contracts executed outside
Pakistan shall be charged at the rates as specified in sub-clause (b), provided that receipts from services and income
from contracts are brought into Pakistan in foreign exchange through normal banking channel.
(b) The rates in respect of income from services rendered outside Pakistan shall be 50% of the rates as specified in clause
(2) of Division III of Part III of the First Schedule and the rates in respect of contracts executed outside Pakistan shall be
50% of the rates as specified in clause (3) of Division III of Part III of the First Schedule. [Clause (3), Part II, 2nd Schedule]
Services rendered or provided for stitching, dying, printing, Exporter /
1% M
embroidery, washing, sizing and weaving Export house
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 153 - PAYMENT FOR GOODS, SERVICES
AND CONTRACTS)
1. Payment made to the Federal Government [Section 49].
2. Payment made to a local authority [Section 49 and SRO 586(I)/91 dated June 30, 1991].
3. Payment made to a local government [Section 49 and SRO 586(I)/91 dated June 30, 1991].
4. Payment for sale of goods where payment is less than seventy-five thousand Rupees in aggregate, during a
financial year. [Section 153(1)(a)]
5. Payment for rendering of or providing of services where payment is less than thirty thousand Rupees in
aggregate, during a financial year. [Section 153(1)(b)]
6. Payment for sale of goods to an importer who has paid tax at the time of import of such goods provided the
goods are sold in the same condition as they were when imported [Section 153(5)(a)]
7. Payment of refund of security deposit. [Section 153(5)(c)].
8. Payment representing the cost of construction material supplied to the contractor by the Federal
Government, Provincial Government or a local authority [Section 153(5)(d)].
9. Payment for purchase of an asset under a lease and buy back agreement by a modaraba, leasing company,
banking company or financial institution [Section 153(5)(f)].
10. The rate of tax, under clause (a) of sub-section (1) of section 153, from distributors of cigarette and
pharmaceutical products shall be 1% of the gross amount of payments. [Clause(24A), Part II, 2nd Schedule]
11. The rate of tax under clause (a) of sub-section (1) of section 153 in the case of distributors, dealers, sub-
dealers, wholesalers and retailers of fast moving consumer goods, fertilizers, electronics excluding mobile
phones, sugar, cement, and edible oil as recipient of payment shall be 0.25% of gross amount of payments
subject to the condition that beneficiaries of reduced rate are appearing on the Active Taxpayers’ Lists issued
under the provisions of the Sales Tax Act, 1990 and the Income Tax Ordinance, 2001 (XLIX of 2001);
Provided that the benefits under this clause shall only be available to those Tier-1 retailers as defined
under Sales Tax Act, 1990 who are integrated and configured with Board or its computerized system for real
time reporting of sales or receipt. [Clause (24C), Part II, 2nd Schedule]
12. The rate of tax under clause (a) of sub-section (1) of section 153 in case of a person, other than a company,
as a recipient of payment for goods supplied to Utility Stores Corporation of Pakistan shall be 1.5% of the
gross amount of payment in respect of supply of tea, spices, salt, dry milk, sugar, pulses, wheat flour and ghee
for the period commencing from the date of issuance of this notification till 30th June, 2020:
Provided that this clause shall not be applicable to supply of tea, spices, salt and dry milk which are sold
under a brand name:
1 Figure “7%” substituted by Finance Act, 2021.

2 Figure “7.5%” substituted by Finance Act, 2021.
Page 62 of 166
Provided further that this clause shall not be applicable where rate of tax under clause (a) of sub-section
(1) of section 153 is less than 1.5% of the gross amount of payment under any provisions of the Ordinance.
[Clause (24CA), Part II, 2nd Schedule]
13. Purchase of agricultural produce directly from the grower subject to receipt of prescribed certificate from the
grower [Clause (12), Part IV, 2nd Schedule, SRO 787(I)/2011 dated August 22, 2011]
14. Cash payment made for meeting the incidental expenses of a business trip to the crew of Oil Tanker [Clause
(12), Part IV, 2nd Schedule, SRO 787(I)/2011 dated August 22, 2011]
15. Payment made to institutions of the Agha Khan Development Network (Pakistan) listed in Schedule 1 of the
Accord and Protocol dated November 13, 1994, executed between the Government of the Islamic Republic
of Pakistan and Agha Khan Development Network. [Clause (16), Part IV, 2nd Schedule].
16. Payment made to a special purpose vehicle for the purpose of securitization or issue of sukuks. [Clause (38)
of Part IV of 2nd Schedule].
17. The provisions of section 151 and 153 shall not apply to the National Disaster Risk Management Fund. [Clause
(38D), Part IV, 2nd Schedule]
18. The provisions of sub section (3) of section 153 shall not apply in respect of payments received by a resident
person for providing services by way of operation of container or chemical or oil terminal at a sea-port in
Pakistan or of an infrastructure project covered by the Government’s Investment Policy, 1997. [Clause (42),
Part IV, 2nd Schedule]
19. Payments made on account of supply of petroleum products imported by the same supplier under the
Government of Pakistan’s de-regulation policy of POL products [Clause (43A) of Part IV of 2nd Schedule].
20. The provisions of clause (a) sub-section (1) of section 153 shall not apply to payments received on sale of air
tickets by traveling agents, who have paid withholding tax on their commission income. [Clause (43B), Part
IV, 2nd Schedule]
21. Tax u/s 153(1)(a) shall not be deducted against payment made to petroleum agent or distributor registered
under Sales Tax Act, 1990 [Clause (43C), Part IV, 2nd Schedule, SRO 57(I)/2012 dated January 24, 2012]
22. The provisions of clauses (a) and (b) of sub-section (1) of section 153 shall not apply in case of an oil tanker
contractor with effect from 1st July 2008, provided that such contractor pays tax @ 2.5%, on the payments
for rendering or providing of carriage services. [Clause (43D), Part IV, 2nd Schedule]
23. The provisions of clause (a) of sub section (1) of section 153 shall not apply in case of goods transport
contractors, provided that such contractors pay tax at the rate of 3.5% on payment for rendering or providing
of carriage services [Clause (43E), Part IV, 2nd Schedule]
24. The provisions of section 153 shall not apply in the case of a start-up, being recipient of payment, as defined
in clause (62A) of section 2. [Clause (43F), Part IV, 2nd Schedule]
25. The provisions of section 153 shall not apply to commodity futures contracts listed on a Futures Exchange
licensed under the Futures Market Act, 2016 (XIV of 2016). [Clause (43G), Part IV, 2nd Schedule]
26. The provisions of sub-section (1) of section 153 shall not apply to any manufacturer-cum-exporter as the
prescribed person:
Provided that-
(a) the manufacturer-cum-exporter shall deduct tax from payments made in respect of goods sold in
Pakistan;
(b) if tax has not been deducted from payments on account of supply of goods in respect of goods sold in
Pakistan, the tax shall be paid by the manufacture-cum-exporter, if the sales in Pakistan are in excess of
five per cent of export sales; and
(c) nothing contained in this clause shall apply to payments made on account of purchase of the goods in
respect of which special rates of tax deduction have been specified under the provisions of the repealed
Ordinance. [Clause (45) of Part IV of 2nd Schedule].
27. The rate of deduction of withholding tax under clauses (a) and (b) of sub-section (1) of section 153
shall be one percent on local sales, supplies and services provided or rendered to the taxpayers falling
in the] following categories, namely:-
(i) textile and articles thereof;
(ii) carpets;
(iii) leather and articles thereof including artificial leather footwear;
(iv) surgical goods; and
(v) sports goods;
Explanation.– For removal of doubt, it is clarified that the relief of reduced rate for
Page 63 of 166
withholding tax under clause (a) and (b) of sub-section (1) of section 153 is available only to
the local sales, supplies and services made by the taxpayers of categories specified at serial
no (i) to (v) of this clause
Provided that the rate of deduction of withholding tax under clauses (a) and (b) of
sub-section (1) of section 153 shall be 0.5% on local sales, supplies and services made by
traders of yarn to the above mentioned categories of taxpayers.
[Clause (45A), Part IV, 2nd Schedule] (Clarifications available in circular # 8 of 2011)
28. The provisions of section 153 shall not apply on the purchase of used motor vehicles from general public.
[Clause (45B), Part IV, 2nd Schedule]
29. Payment made to an oil distribution company or an oil refinery or PE of non-resident E&P companies for
supply of its petroleum products. [Clause (46) of Part IV of 2nd Schedule]
30. The provisions of sub-section (3) of section 153 shall not apply to any payment received by a manufacturer
of iron and steel products relating to sale of goods manufactured by him. [Clause (46A) of Part IV of 2nd
Schedule]
31. The provisions of section 153 shall not apply to the following persons as recipients of payment, namely:-
(i) a Provincial Government;
(ii) a local authority;
(iii) persons who are residents of Azad Kashmir and execute contracts in Azad Kashmir only and
produce a certificate to this effect from the concerned income tax authority;
(iv) subject to fulfillment of procedure laid down in clause (12) of Part IV of Second Schedule,
persons receiving payments exclusively for the supply of agriculture produce including
following–
(I) fresh milk;
(II) fish by any person engaged in fish farming;
(III) live chicken, birds and eggs by any person engaged in poultry farming;
(IV) live animals by any person engaged in cattle farming;
(V) unpackaged meat; and
(VI) raw hides:
Provided that this clause shall not apply to the payments for agriculture produce
which has been subjected to any process other than that which is ordinarily performed to
render such produce to be fit to be taken to the market.;
(v) companies receiving payments for the supply of electricity and gas including companies
receiving payments for the transmission of electricity and gas;
(vi) companies receiving payments for the supply of crude oil;
(vii) hotels and restaurants receiving payments in cash for providing accommodation or food or
both, as the case may be;
(viii) shipping companies and air carriers receiving payments for the supply of passenger tickets
and for the cargo charges of goods transported;
(ix) individuals who are not registered under section 181 of the Ordinance, receiving payments
for the supply of sand, bricks, grit, gravel, crushed stone, soft mud or clay; and
(x) artisans, plumbers, electricians, surface finishers, carpenters, painters or daily wagers,
receiving payments in respect of services provided or rendered to the construction sector
including construction of buildings, roads, bridges and other such structures or the
development of land, subject to the following conditions, namely: –
(a) services under this clause are provided or rendered by an individual who is not
registered under section 181;
(b) the name, Computerized National Identity Card Number and address of such individual
is recorded by the recipient of such service; and (c) payment for such services is made
directly to such individual. [Clause (46AA) of Part IV of 2nd Schedule]
32. The provisions of section 153 shall not apply in respect of payments received by a resident person for supply
of such goods as were imported by the same person and on which tax has been paid under section 148.
33. The provisions of section 153 shall not apply in respect of payments received by a resident person for supply
of such goods as were imported by the same person and on which tax has been paid under section 148.
[Clause (47A) of Part IV of 2nd Schedule]
Page 64 of 166
34. The provisions of sections 150, 151, 233 and Part I, Division VII of the First Schedule shall not apply to any
person making payment to National Investment Unit Trust or a collective investment scheme or Approved
Pension Fund or an Approved Income Payment Plan or a REIT Scheme or a recognized provident fund or an
approved superannuation fund or an approved gratuity fund. [Clause (47B), Part IV, 2nd Schedule]
35. The provisions of clause (a) of sub-section (3) of section 153 shall not apply to cotton ginners. [Clause (47D),
36. Goods imported by companies operating trading houses which-
a. Have paid up capital of exceeding Rs.250 million;
b. Own fixed assets exceeding Rs. 300 million at the close of the Tax Year;
c. Maintain computerized records of imports and sales of goods;
d. Maintain a system for issuance of 100% cash receipts on sales;
e. Present accounts for tax audit every year; and
f. Is registered with the Sales Tax Department:
Provided that the exemption under this clause shall not be available if any of the
aforementioned conditions are not fulfilled for a tax year
Provided further that minimum tax under section 113 shall be 0.5% upto the tax year 2021
and one per cent thereafter.
Explanation.-
(i) For the removal of doubt, exemption under this clause, in respect of section 153, shall only
be available as a recipient and not as withholding agent.
(ii) It is further clarified that in-house preparation and processing of food and allied items for sale
to customers shall not disqualify a company from being treated as a Trading House, provided
that all the conditions in this clause are fulfilled and sale of such items does not exceed two
per cent of the total sales. [Clause (57) of Part IV of 2nd Schedule]
37. Fully as well partly designed/assembled cypher devices, for use within the country as are verified by
Cabinet Division (NTISB) with reference to design, quality and quantity. [Clause (60) of Part IV of 2nd
Schedule].
Schedule]
41. Import and subsequent supply of items with dedicated use of renewable sources of energy like solar and
wind etc., even if locally manufactured, which include induction lamps, SMD, LEDs with or without ballast
with fittings and fixtures, wind turbines including alternator and mast, solar torches, tubular daylighting
devices such as solartube, lanterns and related instruments, PV modules with or without related
components including invertors, charge controllers and batteries [Clause (77), Part IV, 2nd Schedule]
42. The payments made on account of sale or supply of goods or providing or rendering of services during project
construction and operations, shall be exempt from the provisions of section 152(2A) and section 153.] [Clause
(78)(ii), Part IV of 2nd Schedule].
43. The provisions of clause (b) of sub-section (1) of section 153 shall not apply to payments received by National
Telecommunication Corporation against provision of telecommunication services including ancillary services
specified in sub-section (3) of section 41 of the Pakistan Telecommunication (Re-organization) Act, 1996 (XVII
of 1996). [Clause (79A), Part IV of 2nd Schedule].
44. The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction
45. The provisions of section 153 shall not apply to traders being individuals having turnover upto one
hundred million Rupees as a prescribed person.
Explanation: Trader in this clause shall have the meaning as provided in clause (28D) of Part II of the
Second Schedule. [Clause (115) Part IV, 2nd Schedule]
Page 65 of 166
‘trader’ shall mean an individual engaged in business of buying and selling of goods in the same state
including a retailer and a wholesaler but shall not include a distributor. [Clause (28D) Part II, 2nd Schedule]
46. The provisions of section 153(1)(a) shall with effect from the first day of July, 2020 not apply to
distributors, dealers, wholesalers and retailers of locally manufactured mobile phone devices as
withholding agent. [Clause (119) Part IV, 2nd Schedule]
47. Payment made to residents of Tribal Areas or Azad Kashmir who execute contracts in Tribal Areas or as the
case may be, Azad Kashmir only and produces a certificate to this effect from the Political Agent concerned
or the district authority, as the case may be, or in case of Azad Kashmir, from the Taxation Officer concerned
[SRO 586(I)/91 dated June 30, 1991].
48. Payment made to a person who produces a certificate from the Commissioner to the effect that his income
during the tax year is exempt from tax [SRO 586(I)/91 dated June 30, 1991].
49. Payment made by a company or an AOP having turnover of 50M rupees or above exclusively for the sale of
agricultural produce, including fresh milk, live chicken birds and eggs by any grower/producers of agricultural
produce, engaged in poultry farming and by an industrial undertaking engaged in poultry processing which
has not been subjected to any process other than that which is ordinarily performed to render such produce
fit to be taken to the market [SRO 586(I)/91 dated June 30, 1991].
50. Payment made to a company for the sale of electricity and gas [SRO 586(I)/91 dated June 30, 1991].
51. Payment made to a company for the sale of crude oil [SRO 586(I)/91 dated June 30, 1991].
52. Payment made to Attock Refinery Limited, National Refinery Limited or Pakistan Refinery Limited for the sale
of their products [SRO 586(I)/91 dated June 30, 1991].
53. Payment made to Pakistan State Oil Company Limited, Shell Pakistan Limited or Caltex Oil (Pakistan) Limited
for the sale of petroleum products [SRO 586(I)/91 dated June 30, 1991].
54. Payments made in cash to a hotel or restaurant for providing accommodation or food or both as the case
may be [SRO 586(I)/91 dated June 30, 1991].
55. Payment made to a shipping company or air carrier for sale of passenger ticket or cargo charges of goods
transported [SRO 586(I)/91 dated June 30, 1991].
56. Payment made for sale of goods not exceeding Rs. 75,000 in a financial year. Provided that where the total
payments in a financial year, exceed Rs. 75,000 the payer shall deduct tax from the payments including the
tax on payments made earlier without deduction of tax during the same financial year [SRO 586(I)/91 dated
June 30, 1991].
57. Payment made for services rendered, services provided and execution of a contract not exceeding Rs. 30,000
in a financial year. Provided that where the total payments in a financial year, exceed Rs. 30,000, the payer
shall deduct tax from the payments including the tax on payments made earlier without deduction of tax
during the same financial year [SRO 586(I)/91 dated June 30, 1991].
58. Payment made for sale of cottonseed [SRO 586(I)/91 dated June 30, 1991].
59. Payment made to a manufacturer of goods, who produces a certificate from the Commissioner to the effect
that his income during the tax year is not likely to be chargeable to tax due to assessed losses carried forward
[SRO 586(I)/91 dated June 30, 1991].
60. Payment made to an owner of one goods transport vehicle, once in a financial year from a payer on account
of carriage of goods on behalf of such payer on a single journey undertaken during the said financial year [SRO
586(I)/91 dated June 30, 1991].
61. Payment made to a person whose income is not liable to final taxation and who produces a certificate from
the Commissioner to the effect that his income during the tax year is not likely to be chargeable to tax due to
assessed losses carried forward. [SRO 586(I)/91 dated June 30, 1991].
62. Payment made to a person whose income is not liable to final taxation; and
(a) in respect of goods sold in Pakistan, the said tax shall be paid by the exporter, if the sales in
Pakistan are in from whom tax has been deducted under sub-section (1) of section 153;
(b) the aggregate of the tax deducted under the said sub-section is equal to or exceeds the tax
payable under section 147 in respect of that tax year; and
(c) produces a certificate to that effect from the Commissioner [SRO 586(I)/91 dated June 30, 1991].
63. Payments made by exporters of goods on account of supply of such goods as are purchased in respect of
goods exported outside Pakistan. Provided that –
a. the exporter shall deduct tax on account of goods purchased in respect of goods sold in Pakistan;
b. if tax has not been deducted from payments on account of supply of goods excess of five percent
of export sales; and
Page 66 of 166
c. nothing contained in this clause shall apply to payments made on account of purchases of such
goods in respect of which special rates of tax deduction have been specified. [SRO 368(I)/94
dated March 07, 1994].
65. Payments on account of insurance premiums to and claims discharged by the Insurance Companies are not
liable to deduction of tax [C. No. 1(25)IT-I/80, 1-10-1980]
66. The provisions of section 153 shall not apply to builders and developers on-
(a) the purchase of building material except steel and cement;
(b) services of plumbing, electrification, shuttering and other similar services other than those provided
by companies. [Sub-rule 1 of Rule 7, Eleventh Schedule]
Page 67 of 166
1
[]
1 Section 153B omitted by Finance Act, 2021.

153B. Payment of royalty to resident persons
(1) Every person paying an amount of royalty, in full or in part including by way of advance, to a resident person shall deduct tax
from the gross amount payable (including Federal excise duty and provincial sales tax, if any) at the rate specified in Division
IIIB of Part III of the First Schedule.
(2) The tax deductible under sub-section (1) shall be adjustable.
Adjustable /
Withholding
Agent
Minimum
153B Payment of royalty to resident persons
Every person paying an amount of royalty, in full or in part including by
way of advance, to a resident person shall deduct tax from the gross
15% Every person A
amount payable (including Federal excise duty and provincial sales tax,
if any)
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 153B - PAYMENT OF ROYALTY TO RESIDENT PERSONS)
The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction or collection of withholding tax
which were not applicable prior to commencement of the Constitution (Twenty-fifth Amendment) Act, 2018 (XXXVII of 2018) shall not apply
to individual domiciled or company and association of persons resident in the Tribal Areas forming part of the Provinces of Khyber
Pakhtunkhwa and Balochistan under paragraph (d) of Article 246 of the Constitution with effect from the 1st day of June, 2018 to the 30th
day of June, 2023 (both days inclusive). [Clause (109A) Part IV, 2nd Schedule]
Page 68 of 166
Section 154 - Exports
(1) Every authorised dealer in foreign exchange shall, at the time of realisation of foreign exchange
proceeds on account of the export of goods by an exporter, deduct tax from the proceeds at the rate
specified in Division IV of Part III of the First Schedule.
(2) Every authorised dealer in foreign exchange shall, at the time of realisation of foreign exchange
proceeds on account of the commission due to an indenting commission agent, deduct tax from the
proceeds at the rate specified in Division IV of Part III of the First Schedule.
(3) Every banking company shall, at the time of realisation of the proceeds on account of a sale of goods
to an exporter under an inland back-to back letter of credit or any other arrangement as prescribed
by the Board, deduct tax from the amount of the proceeds at the rate specified in Division IV of Part
III of the First Schedule.
(3A) The Export Processing Zone Authority established under the Export Processing Zone Authority
Ordinance, 1980 (VI of 1980), shall at the time of export of goods by an industrial undertaking located
in the areas declared by the Federal Government to be a Zone within the meaning of the aforesaid
Ordinance, collect tax at the rate specified in Division IV of Part III of the First Schedule.
(3B) Every direct exporter and an export house registered under the Duty and Tax Remission for Exports
Rules, 2001 provided in Sub-Chapter 7 of Chapter XII of the Customs Rules, 2001 shall, at the time of
making payment for a firm contract to an indirect exporter defined under the said rules, deduct tax
at the rates specified in Division IV of Part III of the First Schedule.
(3C) The Collector of Customs at the time of clearing of goods exported shall collect tax from the gross
value of such goods at the rate specified in Division IV of Part III of the First Schedule.
(4) The tax deductible under this section shall be a final tax on the income arising from the transactions
referred to in this section.
(5) The provisions of sub-section (4) shall not apply to a person who opts not to be subject to final
taxation:
Provided that this sub-section shall be applicable from tax year 2015 and the option shall be
exercised every year at the time of filing of return under section 114:
Provided further that the tax deducted under this sub-section shall be minimum tax.
Page 69 of 166
Adjustable
Section Nature of Payment / Transaction Rate Withholding Agent / Final /
Minimum
154 Exports/Indirect Exports/EPZ/Export House:
On realization of proceeds on account of export
(1) 1% F
of goods
Commission to non-export indenting agent 5% F
(2) Commission to Export Indenting Agent / export
5% Authorized Dealer / F
buying house
Banking Company
On realization of proceeds on account of sale of
goods to an exporter under inland back to back
(3) 1% F
LC or any other arrangement as may be
prescribed by CBR
(3A) Exports of goods located in EPZ 1% EPZ Authority F
Exporter / Export house
Payment to indirect exporters as defined in DTRE
(3B) 1% registered under DTRE F
Rules, 2001
Rules, 2001
(3C) Clearance of goods exported 1% Collector of Customs F
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 154 - EXPORTS)

1. Realization on behalf of the Federal Government [Section 49].
2. Realization on behalf of a Provincial Government [Section 49].
3. Realization on behalf of a Local Authority [Section 49].
4. Realization against export of cooking oil or vegetable ghee to Afghanistan by a person from whom tax has
been collected on the import of edible oil. [Clause (47C) of Part IV of 2nd Schedule].
5. Realization on behalf of Cotton Export Corporation of Pakistan. [SRO 987(I)/92 dated October 07, 1992].
6. The provisions of sub-section (1) of section 154 shall not apply to taxpayers operating halal meat
production and qualifying for exemption under clause (126K) of Part-I of this Schedule for the period
specified in clause (126K). [Clause (93), Part IV, 2nd Schedule]
8. (b) The provisions of section 154 shall not apply to the export of goods which takes place within the
jurisdiction of Border sustenance markets specified in Table below:-
Sr.# PCT Heading Description
1. 02012000 Other cuts with bone in (Meat of bovine animals, fresh or chilled)
2. 02013000 Boneless (Meat of bovine animals, fresh or chilled)
3. 02022000 Other cuts with bone in (Meat of bovine animals, frozen)
4. 02023000 Boneless (Meat of bovine animals, frozen)
5. 03021100 Fish
6. 04090000 Honey
7. 06022000 Plants
8. 07011000 - SEED (Potatoes)
9. 07019000 Other (Potatoes)
10. 07020000 TOMATOES, FRESH OR CHILLED
11. 07031000 - ONIONS AND SHALLOTS
12. 07032000 Garlic

Page 70 of 166
13. 07061000 - CARROTS AND TURNIPS
14. 07069000 - OTHER which qualifies for exemption or concession or reduced rate
under the provisions of Custom Act, 1969 and Sales Tax Act, 1990 or
15. 07070000 Cocumbers
16. 07093000 Egg Plant
17. 07096000 Fruits of the genus Capsicum or of the genus Pimenta (pepper)
18. 07099900 Others (Lady Finger)
19. 07101000 Fresh Potato
20. 07102100 Pea
21. 07103000 Spinach
22. 08031000 - Plantains (Bananas)
23. 08039000 - Other (Bananas)
24. 08041010 Fresh (Dates)
25. 08041020 Dreid (Dates)
26. 08045020 --- Mangoes
27. 08052100 -- Mandarins (including tangerines and satsumas)
28. 08052910 --- Kino (fresh)
29. 08061000 Grapes (fresh)
30. 08071100 - - WATERMELONS
31. 08071900 Melons
32. 08091000 Apricots
33. 08092900 Cherries
34. 08093000 Peaches
35. 08101000 Strawberries
36. 08109010 Pomegranates
37. 08109090 Fresh fruits nes (Other)
38. 08133000 Apple
39. 09021000 Green Tea
40. 09022000 Other green tea
41. 09030000 Mate
42. 09042110 Red Chillies (Whole)
43. 09042190 --- Other which qualifies for exemption or concession or reduced rate
44. 09042210 Red Chillies (Powder)
45. 09042290 - - - Other which qualifies for exemption or concession or reduced rate
46. 09051000 - - Neither crushed nor ground (Vanilla)
47. 09052000 - - Crushed or ground (Vanilla)
48. 10061010 - - - SEED FOR SOWING (Rice)
49. 10061090 - - - OTHER which qualifies for exemption or concession or reduced rate
50. 10062000 - HUSKED (BROWN) RICE
51. 10063010 - - - BASMATI (Rice)
52. 10063090 - - - OTHER which qualifies for exemption or concession or reduced rate
53. 10064000 - BROKEN RICE
54. 11010010 Flour (of Wheat)
55. 12074000 - Sesamum seeds
56. 12079900 Other (hemp Seeds)
Page 71 of 166
57. 12119000 Ajwain
58. 15162020 Vegetable Oils and their fractions
59. 19021920 - - - VERMACELLI
60. 19041090 Papad
61. 20071000 - Homogenised preparations
62. 20081900 - - Nimko
63. 21069090 - - - OTHER (Custard Powder)
64. 23099000 Other (Animal feed)
65. 25010010 Table Salt
66. 25010020 - - - Rock Salt
67. 25010030 - - - Sea Salt
69. 34060000 Candies
70. 36050000 Safety Match
71. 39264090 - OTHER (Plastic Articles)
72. 53101000 Woven fabrics of jute or of other textile bast fibres, unbleached
73. 53109010 - - - Jute (hessian cloth)
74. 56074100 - - Binder or baler twine
75. 56074900 - - Other which qualifies for exemption or concession or reduced rate
76. 56075000 - Of other synthetic fibres
77. 58021100 - - Unbleached (Terry toweling in similar woven terry fabrics, OF cotton)
78. 58021900 - - Other (Terry toweling in similar woven terry fabrics, OF cotton)
79. 58022000 - Terry toweling and similar woven terry fabrics, of other textile materials
80. 58023000 - Tufted textile fabrics
81. 58043000 - Hand made lace
82. 58050000 Hand-woven tapestries of the type Gobelins, Flanders, Aubusson, Beauvais
and the like, and needle-worked tapestries (for example, petit point, cross
stitch), whether or not made up.
83. 58064000 - Fabrics consisting of warp without weft assembled by means of an
adhesive (bolducs)
84. 59011000 - Textile fabrics coated with gum or amylaceous substances, of a kind used
for the outer covers of books or the like
85. 61119000 Mix Goods/Garments (Babies garments&clothing accessories)
86. 62031990 - - - OTHER (Men or Boys Suits etc)
87. 62042200 - - Of cotton
88. 62042900 - - Of other textile materials
89. 62043900 - - Of other textile materials
90. 62044210 - - - Shisha embroidered dresses
91. 62129000 - OTHER which qualifies for exemption or concession or reduced rate
92. 63021090 - OTHER (Bed linen, Toilet linen etc)
93. 63051000 Jute Bags (of jute or of other textile bast fibres of heading 53.03)
94. 63052000 Sacks and bags, for packing of goods, of cotton
95. 63090000 Worn clothing and other worn articles
96. 69111090 Other (Tableware and kitchenware of porcelain or china)
97. 69119000 Other (Household articles nes & toilet articles of porcelain or china)
98. 70133700 Drinking glasses (excl. glasses of glass caramics or of lead crystal a
99. 73181690 Nuts, iron or steel, nes (Others)
100. 82055900 Tools for masons, watchmakers, miners and hand tools nes (Other)
Page 72 of 166
101. 82059000 Hand tools (Other, including sets of articles of two or more subheadings of
this heading)
102. 82119100 - - Table knives having fixed blades
103. 82119200 - - Other knives having fixed blades
104. 82159990 Tableware articles not in sets and not plated with precious metal
105. 84485100 Needle
106. 96170010 - - - Vaccum flasks
The exemption under this clause shall be available on the import of goods subject to following
conditions, namely:-
(i) Such goods shall be supplied only within the limits of Border Sustenance Markets established in
cooperation with Iran and Afghanistan;
(ii) If the goods, on which exemption under this table has been availed, are bought outside the limits of
such markets, income tax shall be charged on the import value as per provisions of section 148 of this
Ordinance;
(iii) Such items in case of import, shall be allowed clearance by the Customs Authorities subject to
furnishing of bank quarantee equal to the amount of income tax involved and the same shall be
released after presentation of consumption certificate issued by the Commissioner Inland Revenue
having jurisdiction;
(iv) The said exemption shall only be available to a person upon furnishing proof of having a functional
business premises located within limits of the Border Sustenance Markets; and
(v) Breach of any of the conditions specified herein shall attract relevant legal provisions of the
Ordinance, besides recovery of the amount of income tax along with default surcharge and penalties
involved.
[Clause (12N)(b), Part IV, 2nd Schedule]
Page 73 of 166
1
Section 154A - Export of Services
(1) Every authorized dealer in foreign exchange shall, at the time of realization of foreign exchange
proceeds on account of the following, deduct tax from the proceeds at the rates specified in Division
IVA of Part III of the First Schedule-
(a) exports of computer software or IT services or IT enabled services in case tax credit under
section 65F in not available;
(b) services or technical services rendered outside Pakistan or export from Pakistan;
(c) royalty, commission or fees derived by a resident company from a foreign enterprise in
consideration for the use outside Pakistan of any patent, invention, model, design, secret
process or formula or similar property right, or information concerning industrial, commercial
or scientific knowledge, experience or skill made available or provided to such enterprise;
(d) construction contracts executed outside Pakistan; and
(e) other services rendered outside Pakistan as notified by the Board from time to time;
(2) The tax deductible under this section shall be a final tax on fulfillment of the following conditions-
(a) return has filed;
(b) withholding tax statements for the relevant tax year have been filed;
(c) sales tax returns under Federal or Provincial laws have been filed, if required under the law;
(d) no credit for foreign taxes paid shall be allowed.
(3) The provisions of sub-section (2) shall not apply to a person who does not fulfill the specified
conditions or who opts not to be subject to final taxation:
Provided that the option shall be exercised every year at the time of filing of return under
section 114.
(4) Where a taxpayer, while explaining the nature and source of any amount, investment, money,
valuable article, expenditure, referred to in section 111, take into account any source of income which
is subject to final tax in accordance with the provisions of this section, he shall not be entitled to take
credit of a sum that can be reasonably attributed to the business activity or activities mentioned in
sub-section (1).
(5) The Board in consultation with State Bank of Pakistan shall prescribe mode, manner and procedure
of payment of tax under this section.
(6) The Board shall have power to include or exclude certain services for applicability of provisions of this
section.

Adjustable
Section Nature of Payment / Transaction Rate WH Agent / Final /
Minimum
at the time of realization of foreign exchange proceeds on A
account of the following:
(a) exports of computer software or IT services or IT enabled
Every
services in case tax credit under section 65F in not
authorized
available; F [subject
154 1% dealer in
(b) services or technical services rendered outside Pakistan or to
foreign
export from Pakistan; conditions]
exchange
(c) royalty, commission or fees derived by a resident
company from a foreign enterprise in consideration for
the use outside Pakistan of any patent, invention, model,
1 Section 154A inserted by Finance Act, 2021.

Page 74 of 166
design, secret process or formula or similar property right,
or information concerning industrial, commercial or
scientific knowledge, experience or skill made available or
provided to such enterprise;
(d) construction contracts executed outside Pakistan; and
(e) other services rendered outside Pakistan as notified by
the Board from time to time;
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 154A- EXPORTS)

1. The tax deductible under this section shall be a final tax on fulfillment of the following conditions-
(a) return has filed;
(b) withholding tax statements for the relevant tax year have been filed;
(c) sales tax returns under Federal or Provincial laws have been filed, if required under the law;
(d) no credit for foreign taxes paid shall be allowed. [Section 154A(2)].
Page 75 of 166
Section 155 - 1[Rent of immoveable] property
(1) Every prescribed person making a payment in full or part (including a payment by way of advance) to
any person on account of rent of immovable property (including rent of furniture and fixtures, and
amounts for services relating to such property) shall deduct tax from the gross amount of rent paid at
the rate specified in Division V of Part III of the First Schedule.
Explanation.- “gross amount of rent” includes the amount referred to in sub-section (1) or (3) of
section 16, if any.
2
Explanation.- For removal of doubt, it is clarified that the sub section (1) shall apply when a payment
is made on account of rent of immoveable property irrespective of head of income.
(3) In this section, “prescribed person” means -
(i) the Federal Government;
(ii) a Provincial Government;
(iii) Local Government;
(iv) a company;
(v) a non-profit organization or a charitable institution;
(vi) a diplomatic mission of a foreign state;
(via) a private educational institution, a boutique, a beauty parlour, a hospital, a clinic or a
maternity home;
(vib) individuals or association of persons paying gross rent of rupees one and a half million and
above in a year; or
(vii) any other person notified by the Board for the purpose of this section.
Adjustable
Section Nature of Payment/Transaction Rate Withholding Agent / Final/
Minimum
155 Rent of immoveable property
Any payment in full or in part including Federal/Provincial/Local
by way of advance on account of rent Government, Company, non-
RATES
of immovable property including rent profit organization or a
SPECIFIED A
of furniture and fixtures and services charitable institution, a
BELOW
relating to such property and amounts diplomatic mission of a
to Individual or AOP foreign state, Private
Any payment in full or in part including Educational Institutions,
by way of advance on account of rent Boutiques, Beauty parlors,
15% of the
of immovable property including rent Hospitals, Clinics, Maternity
gross amount of A
of furniture and fixtures and services homes or Individuals / AOPs
rent
relating to such property and amounts paying gross rent of Rs.
to a Company 1,500,000/- and above
WITHHOLDING RATES FOR INDIVIDUAL OR AOP

S. No. Gross amount of rent Rate of tax
Where the gross amount of rent does not exceed
1. Rs. 300,000 Nil
Where the gross amount of rent exceeds Rs. 5 per cent of the gross amount exceeding Rs.
2. 300,000 but does not exceed Rs. 600,000. 300,000.
Where the gross amount of rent exceeds Rs. Rs. 15,000 plus 10 per cent of the gross amount
3. 600,000 but does not exceed Rs. 2,000,000. exceeding Rs. 600,000.
1 Words “Income from” substituted by Finance Act, 2021.

2 Explanation inserted by Finance Act, 2021.
Page 76 of 166
Where the gross amount of rent exceeds Rs. Rs. 155,000 plus 25 per cent of the gross
4. 2,000,000 amount exceeding Rs. 2,000,000.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section155 - INCOME FROM PROPERTY)

1. Rent paid to the Federal Government [Section 49].
2. Rent paid to a Provincial Government [Section 49].
3. Rent paid to a Local Authority [Section 49].
4. Rent paid to institutions of the Agha Khan Development Network (Pakistan) listed in Schedule 1 of the Accord
and Protocol dated November 13, 1994, executed between the Government of the Islamic Republic of
Pakistan and Agha Khan Development Network [Clause (16) of Part IV of 2nd Schedule].
5. Rent paid to a person who produces a certificate from the Additional Commissioner to the effect that the
recipient’s income during the tax year is exempt from tax under the Ordinance [SRO 1130(I)/91 dated
November 07, 1991].
7. Payment made to the Pakistan Domestic Sukuk Company Ltd. [Clause 68, Part IV, 2nd Schedule]
8. The provisions of sections 147, 150A, 151, 155 and 236K shall not apply to “The second Pakistan international
Sukuk Company Limited” and the Third Pakistan International Sukuk Company Limited, as a recipient. [Clause
96, Part IV, 2nd Schedule]

Page 77 of 166
Section 156 - Prizes and winnings
(1) Every person paying prize on a prize bond, or winnings from a raffle, lottery, prize on winning a quiz,
prize offered by companies for promotion of sale, or cross-word puzzle shall deduct tax from the gross
amount paid at the rate specified in Division VI of Part III of the First Schedule.
(2) Where a prize, referred to in sub-section (1), is not in cash, the person while giving the prize shall
collect tax on the fair market value of the prize.
(3) The tax deducible under sub-section (1) or collected under section (2) shall be final tax on the income
from prizes or winnings referred to in the said sub-sections.
Adjustable/
Withholding
Section Nature of Payment / Transaction Rates Final/
Agent
Minimum
Prizes and winnings
Prize on Prize bond & cross word puzzle 15% F
156 Every
Lotteries, Raffles Prizes on quizzes or offered by
20% Person F
companies.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 156 - PRIZES AND WINNINGS)
1. Prize or winnings paid to a person whose income is exempt from tax and produces a certificate from the
Commissioner of an exemption from deduction of tax [Section 159].
2. Prize or winnings paid to institutions of the Agha Khan Development Network (Pakistan) listed in Schedule 1
of the Accord and Protocol dated November 13, 1994, executed between the Government of the Islamic
Republic of Pakistan and Agha Khan Development Network [Clause (16) of Part IV of 2nd Schedule].

Page 78 of 166
Section 156A - Petroleum Products
(1) Every person selling petroleum products to a petrol pump operator shall deduct tax from the amount
of commission or discount allowed to the operator at the rate specified in Division VIA of Part III of
the First schedule.
(2) The tax deductible under sub-section (1) shall be a final tax on the income arising from the sale of
petroleum products to which sub-section (1) applies.
Adjustable /
Withholding
Agent
Minimum
Commission/discount on Petroleum Products
156A Commission or discount on Petroleum Products to
12% Every Person F
Petrol Pump Operators
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 156A - Petroleum Products)

1. The provisions of sub-section (2) of section 156A and clause (a) of sub-section (1) of section 169 shall not
apply in respect of a person if the person opts to file return of total income along with accounts and
documents as may be prescribed, subject to the condition that minimum tax liability under normal tax regime
shall not be less than 10% of the commission or discount received. [Clause (56F), Part IV, 2nd Schedule].
2[ ]

2 Section 156B omitted by Finance Act, 2020. Earlier it was:
156B. Withdrawal of balance under Pension Fund.
(1) A pension fund manager making payment from individual pension accounts, maintained under any approved Pension Fund,
shall deduct tax at the rate specified in sub-section (6) of section 12 from any amount -
(a) withdrawn before the retirement age:
Provided that the tax shall not be deducted in case of the eligible person suffering from any disability as mentioned
in sub-rule (2) of rule 17 of the Voluntary Pension System Rules, 2005 which renders him unable to continue with any
employment at the age which he may so elect to be treated as the retirement age or the age as on the date of such
disability if not so elected by him:
Provided further that the tax shall not be deducted on the share of the nominated survivor of the deceased eligible
person and would be treated as if the eligible person had reached the age of retirement;
(b) withdrawn, if in excess of fifty per cent of his accumulated balance at or after the retirement age:
Provided that the tax shall not be deducted in case, the balance in the eligible persons’ individual pension account is
invested in an approved income payment plan of a pension fund manager or paid to a life insurance company for the purchase
of an approved annuity plan or is transferred to another individual pension account of the eligible person or the survivors’
pension account in case of death of the eligible person maintained with any other pension fund manager as specified in the
Voluntary Pension System Rules, 2005.
Withholding Adjustable/
Section Nature of Payment / Transaction Rates
Agent Final/ Minimum
Withdrawal of balance under Pension Fund
1) Withdrawal before retirement age
Pension Fund
156B 2) Withdrawal, if in excess of 50% of Average rate of tax on taxable A
Manager
accumulated balance at or after the retirement income of 3 preceding years
age.
Page 79 of 166
1[ ]

231A. Cash withdrawal from a bank
(1) Every banking company shall deduct tax at the rate specified in Division VI of Part IV of the First Schedule, if the payment for
cash withdrawal, or the sum total of the payments for cash withdrawal in a day, exceeds fifty thousand rupees.
Explanation.- For removal of doubt, it is clarified that the said fifty thousand rupees shall be aggregate withdrawals from all
the bank accounts in a single day.

Adjustable/
Withholding
Agent
Minimum
0.6%
Cash Withdrawal from bank
231A only for the person whose name is Every Banking
Cash withdrawal exceeding Rs. 50,000 in a A
not appearing in the active Company
day
taxpayers’ list
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 231A - CASH WITHDRAWAL FROM A BANK)
1. Withdrawal by the Federal Government [Section 49 and 236O(a)].
2. Withdrawal by a Provincial Government [Section 49 and 236O(a)].
3. Withdrawal by a Local Authority [Section 49].
4. Withdrawal by a foreign diplomat or a diplomatic mission in Pakistan [Section 236O(b)].
5. Withdrawal by a person whose income is exempt from tax and produces a certificate from the Commissioner of an exemption from
deduction of tax. [Section 159 and 236O(c)].
6. Any cash withdrawal, from a bank made by an earthquake victim against compensation received from GOP including payments through
Earthquake Reconstruction and Rehabilitation Authority account. [Clause 61, Part IV, 2nd Schedule].
7. Provisions of withholding tax under this ordinance shall not apply to a banking company as a recipient of the amount on which tax is
deductible. [Rule 5(2), 7th Schedule, ITO, 2001] No exemption Certificate is required [Circular # 2 of 2008]
Sukuk Company Limited” and the Third Pakistan International Sukuk Company Limited, as a payer. [Clause 95, Part IV, 2nd Schedule]
9. The rate of tax shall be 0.15% under section 231A on cash withdrawal by an exchange company, duly licensed and authorized by the
State Bank of Pakistan, exclusively dedicated for its authorized business related transactions, subject to the condition that a certificate
issued by the concerned Commissioner Inland Revenue for a financial year mentioning details and particulars of its Bank Account being
used entirely for business transactions is provided. [Clause 28B, Part II, 2nd Schedule].
10. The provisions of section 231A shall not apply to a Pak Rupee account if the deposits in the account are made solely from foreign
remittances credited directly into such account. [Clause (101A), Part IV, 2nd Schedule]
11. The provisions of sections 231A, 231AA and 236P shall not apply to a Pak Rupee Account in a tax year to the extent of foreign
remittances credited into such account during that tax year. [Clause (101AA), Part IV, 2nd Schedule]
12. The provisions of section 231A shall not apply in respect of cash withdrawal made from a “Branchless Banking (BB) Agent Account”
utilized to render branchless banking services to customers. [Clause 101, Part IV, 2nd Schedule].
13. The provisions of sections 113, 151, 231A, 231AA and 236P shall not apply to the Supreme Court of Pakistan – Diamer Bhasha &
Mohmand Dams – Fund [Clause 108, Part IV, 2nd Schedule]
14. The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction or collection of
withholding tax which were not applicable prior to commencement of the Constitution (Twenty-fifth Amendment) Act, 2018 (XXXVII
of 2018) shall not apply to individual domiciled or company and association of persons resident in the Tribal Areas forming part of the
Provinces of Khyber Pakhtunkhwa and Balochistan under paragraph (d) of Article 246 of the Constitution with effect from the 1st day
of June, 2018 to the 30th day of June, 2023 (both days inclusive). [Clause (109A) Part IV, 2nd Schedule]
15. The provisions of section 151, 231A, 231AA and 236P shall not apply to The Prime Minister’s COVID-19 Pandemic Relief Fund-
Clarifications (Section 231A - CASH WITHDRAWAL FROM A BANK)

1. The incidence of withholding tax is on the person in whose name the account, deposit or any other arrangement exists and from
which a cash withdrawal in excess of Rs. 50,000 per day is made.
2. Withholding tax is attracted on issuance of bearer Pay Order or other similar banking instrument either by debiting an account,
deposit or any other arrangement, or against cash received.
3. Withholding tax is not attracted on encashment of Pay Order or other similar banking instruments.
4. Withholding tax is not attracted on direct cash payment against home remittances from abroad.
5. Withholding tax is attracted on cash withdrawn from ATM outside Pakistan against credit card issued in Pakistan.
6. Withholding tax is not attracted on cash withdrawal from ATM in Pakistan against credit card issued outside Pakistan.
7. Withholding tax is not attracted on credit card issued by Non-banking companies.
8. Transactions through “clearing house” are not cash withdrawals and therefore withholding tax is not attracted.
Page 80 of 166
1[ ]
9. Whenever there is a cash withdrawal of full amount or amount of withdrawal and tax involved exceed the balance, then either
the bank should refuse payment on account of “withdrawal amount exceeds the balance” or make payment to the person
presenting the instrument after setting aside the amount of tax involved.
10. Withholding tax is not attracted on cash withdrawals by banks from accounts maintained with sub-treasury for their day-to-day
cash requirements.
11. Generally, the withdrawal limit from an ATM is below Rs. 25,000 per day and therefore, withdrawals for day-to-day requirements
by default do not attract withholding tax. However, in case cash withdrawal from an ATM per day exceeds Rs. 50,000, withholding
tax would be attracted.
12. The provisions of section 231A shall not apply in respect of cash withdrawal made from a “Branchless Banking (BB) Agent
Account” utilized to render branchless banking services to customers. [Clause 101, Part IV, 2 nd Schedule].
231AA. Advance tax on Transaction in Bank
(1) Every banking company, non-banking financial institution, exchange company or any authorized dealer of foreign exchange
shall collect advance tax at the time of sale against cash of any instrument, including Demand Draft, Pay Order, CDR, STDR,
SDR, RTC, or any other instrument of bearer nature or on receipt of cash on cancellation of any of these instruments:
(2) Every banking company, non-banking financial institution, exchange company or any authorized dealer of foreign exchange
shall collect advance tax at the time of transfer of any sum against cash through online Transfer, Telegraphic Transfer, Mail
Transfer or any other mode of electronic transfer.
(3) The advance tax under this section shall be collected at the rate specified in Division VIA of Part IV of the First Schedule, where
the sum total of payments for transactions mentioned in sub-section (1) or sub-section (2) as the case may be, exceed twenty-
five thousand rupees in a day.

Adjustable/
Section Nature of Payment / Transaction Rate Withholding Agent Final/
Minimum
Advance Tax on Transactions in Bank
0.6% when the amount
Sale against cash of any instrument, including DD, Every banking
exceeds Rs. 25,000/- in
PO, CDR, STDR, SDR, RTC or any other bearer nature company, Non-
a day
or on receipt of cash on cancellation of any of these Banking Financial
231AA instruments. Institution, Exchange A
only for the person
Company, Authorized
whose name is not
Transfer of any sum against cash through online dealer of Foreign
appearing in the active
Transfer, Telegraphic Transfer, Mail Transfer or any Exchange
taxpayers’ list
other mode of electronic transfer.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 231AA - Advance tax on Transaction in Bank)
Sukuk Company Limited” and the Third Pakistan International Sukuk Company Limited, as a payer. [Clause 95, Part IV, 2nd Schedule]
2. The provisions of section 231A shall not apply to a Pak Rupee account if the deposits in the account are made solely from foreign
remittances credited directly into such account. [Clause (101A), Part IV, 2nd Schedule]
Mohmand Dams – Fund. [Clause 108, Part IV, 2nd Schedule]
Page 81 of 166
Section 231B - Advance tax on private motor vehicles
(1) Every motor vehicle registering authority of Excise and Taxation Department shall collect advance tax
at the time of registration of a new locally manufactured motor vehicle, at the rates specified in
Division VII of Part IV of the First Schedule:
Provided that no collection of advance tax under this sub-section shall be made after five
years from the date of first registration as specified in clauses (a), (b) and (c) of sub-section (6).
(1A) Every leasing company or a scheduled bank or a non-banking financial institution or an investment
bank or a modaraba or a development finance institution, whether shariah compliant or under
conventional mode, at the time of leasing of a motor vehicle to a person whose name is not appearing
in the active taxpayers' list, either through ijara or otherwise, shall collect advance tax at the rate of
four per cent of the value of the motor vehicle.
(2) Every motor vehicle registering authority of Excise and Taxation Department shall collect advance tax
at the time of transfer of registration or ownership of a private motor vehicle, at the rates specified
in Division VII of Part IV of the First Schedule.
Provided that no collection of advance tax under this sub-section shall be made on transfer
of vehicles after five years from the date of first registration in Pakistan.
1
(2A) Every motor vehicle registration authority of Excise and Taxation Department shall, at the time of
registration, collect tax at the rates specified in Division VII of Part IV of the First Schedule, if the locally
manufactured motor vehicle has been sold prior to registration by the person who originally
purchased it from the local manufacturer.
(3) Every manufacturer of a motor vehicle shall collect, at the time of sale of a motor car or jeep, advance
tax at the rate specified in Division VII of Part IV of the First Schedule from the person to whom such
sale is made.
(4) Sub-section (1) shall not apply if a person produces evidence that tax under sub-section (2) in case of
a locally manufactured vehicle or tax under section 148 in the case of imported vehicle was collected
from the same person in respect of the same vehicle.
(5) The advance tax collected under this section shall be adjustable:
Provided that the provisions of this section shall not be applicable in the case of –
(a) the Federal Government;
(b) a Provincial Government;
(c) a Local Government;
(d) a foreign diplomat; or
(e) a diplomatic mission in Pakistan.
(6) For the purposes of this section the expression “date of first registration” means—
(a) the date of issuance of broad arrow number in case a vehicle is acquired from the Armed
Forces of Pakistan;
(b) the date of registration by the Ministry of Foreign Affairs in case the vehicle is acquired from
a foreign diplomat or a diplomatic mission in Pakistan;
(c) the last day of the year of manufacture in case of acquisition of an unregistered vehicle from
the Federal or a Provincial Government; and
(d) in all other cases the date of first registration by the Excise and Taxation Department.

Page 82 of 166
(7) For the purpose of this section “motor vehicle” includes car, jeep, van, sports utility vehicle, pick-up
trucks for private use, caravan automobile, limousine, wagon and any other automobile used for
private purpose.
Adj/
Section Nature of Payment / Transaction Rates Withholding Agent Fin/
Min
231B  at the time of registration of a new
locally manufactured motor vehicle
 at the time of sale of a motor car or jeep
(1) Engine Capacity Tax
(3) 1. Upto 850cc Rs. 7,500  Motor Vehicle
2. 851cc to 1000cc Rs. 15,000 Registration Authority
3. 1001cc to 1300cc Rs. 25,000 A
4. 1301cc to 1600cc Rs. 50,000  Manufacturer of a motor
5. 1601cc to 1800cc Rs. 75,000 vehicle
6. 1801cc to 2000cc Rs. 100,000
7. 2001cc to 2500cc Rs. 150,000
8. 2501cc to 3000cc Rs. 200,000
9. Above 3000cc Rs. 250,000
Every Leasing Company,
4% of the value of scheduled Bank , Non-
Motor Vehicle Banking Financial
Institution, Investment
(1A) Leasing of Motor vehicle to a non-filer only for the person Bank, Development Finance
A
either through ijara or otherwise. whose name is not Institution, Non-Banking
appearing in the Finance Institution,
active taxpayers’ MODARBA (Sharia
list compliant or under
conventional mode)
(2) at the time of transfer of registration or
ownership
Engine Capacity Tax
1. Upto 850cc -
2. 851cc to 1000cc Rs. 5,000
3. 1001cc to 1300cc Rs. 7,500
4. 1301cc to 1600cc Rs. 12,500
5. 1601cc to 1800cc Rs. 18,750 Motor Vehicle Registration
A
6. 1801cc to 2000cc Rs. 25,000 Authority
7. 2001cc to 2500cc Rs. 37,500
8. 2501cc to 3000cc Rs. 50,000
9. Above 3000cc Rs. 62,500
Provided that the rate of tax to be
collected shall be reduced by 10% each
year from the date of first registration in
Pakistan
(2A) if the locally manufactured motor vehicle
has been sold prior to registration by the
person who originally purchased it from
the local manufacturer. Motor Vehicle Registration
A
Engine Capacity Tax Authority
1. Up to 1000cc Rs. 50,000
2. 1001cc to 2000cc Rs. 100,000
3. 2001cc and above Rs. 200,000
Page 83 of 166
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 231B - ADVANCE TAX ON PRIVATE MOTOR
VEHICLES)
1. Not applicable in the case of:
a. The Federal Government
b. The Provincial Government
c. The Local Government
d. A Foreign Diplomat
e. A diplomatic mission in Pakistan [Section 231B(5)]
2. Sub-section (1) of Section 231B shall not apply if a person produces evidence that tax under sub-section (2)
in case of a locally manufactured vehicle or tax under section 148 in the case of imported vehicle was collected
from the same person in respect of the same vehicle. [Section 231B(4)].
3. The provisions of section 231B(1A) shall not apply to light commercial vehicles leased under the Prime
Minister’s Youth Business Loan Scheme. [Clause (102), Part IV, 2nd Schedule].

Page 84 of 166
Section 233 - Brokerage and commission
(1) Where any payment on account of brokerage or commission is made by the Federal Government, a
Provincial Government, a Local Government, a company or an 1[association of persons or individual
having turnover of hundred million rupees or more] (hereinafter called the “principal”) to a person
(hereinafter called the “agent”), the principal shall deduct advance tax at the rate specified in
2
[Division II] Part IV of the First Schedule from such payment.
(2) If the agent retains Commission or brokerage from any amount remitted by him to the principal, he
shall be deemed to have been paid the commission or brokerage by the principal and the principal
shall collect advance tax from the agent.
3
[(2A) Notwithstanding the provisions of sub-section (1), where the principal is making payment on account
of commission to an advertising agent, directly or through electronic or print media, the principal shall
deduct tax (in addition to tax required to be deducted under clause (b) of sub-section (1) of section
153 on advertising services excluding commission), at the rate specified in Division II of Part IV of the
First Schedule on the amount equal to-
A x 15
85
Where A = amount paid or to be paid to electronic or print media for advertising services
(excluding commission) on which tax is deductible under clause (b) of sub-section (I)
of section 153.
(2B) Tax deducted under sub-section (2A) shall be 4[minimum] tax on the income of the advertising agent.]
(3) Where any tax is required to be collected from a person under sub-section (1), such tax shall be the
5
[minimum] tax on the income of such persons.
Adjustable/
Minimum
233 Brokerage and commission income (including non-resident agents)
10% Federal / Provisional /
Advertising Agents Commission Local Government,
Life Insurance Agents where yearly commissions is Company, AOP M
8%
below Rs. 500,000 constituted by or
All other commissions 12% under any law.
1 Word “association of persons constituted by, or under any law” inserted by Finance Act, 2021.
3 Sub-section (2A) and (2B) inserted by Finance Act, 2017.
4 Word “final” substituted by Finance Act, 2019.
Page 85 of 166
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 233 - BROKERAGE AND COMMISSION)
1. Brokerage or commission paid to the Federal Government [Section 49].
2. Brokerage or commission paid to a Provincial Government [Section 49].
3. Brokerage or commission paid to a Local Authority [Section 49].
4. Brokerage or commission paid to a Venture Capital Company [Clause (38A) of Part IV of 2nd Schedule].
amount on which tax is deductible. [Rule 5(2), 7th Schedule, ITO, 2001]. No exemption Certificate is required.
6. Brokerage or commission paid to a special purpose vehicle for the purpose of securitization or issue of sukuks
7. The provisions of sections 150, 151 and 233 shall not apply to a Venture Capital Company. [Clause (38A), Part
IV, 2nd Schedule]
8. The provisions of section 150, 151, 152, 153 and 233 shall not apply to the Islamic Development Bank. [Clause
(38C), Part IV, 2nd Schedule].
9. Brokerage or commission paid to National Investment (Unit) Trust or a Collective Investment Scheme or a
modaraba or Approved Pension Fund or an Approved Income Payment Plan or a REIT Scheme or a Private
Schedule]
13. 2The provisions of section 233 shall not apply to commission received by a retail branchless banking agent
on any amount disbursed by the Ehsaas Emergency Cash Transfer Programme for the period commencing
on 16th April, 2020 and ending on 30th day of September 2020. [Clause (102A), Part IV, 2nd Schedule]

2 Clause (102A) inserted by Finance Act, 2020. Earlier it was inserted by SRO 315(I)/2020 dated April 16, 2020.
Page 86 of 166
1[ ]

233A. Collection of tax by a stock exchange registered in Pakistan
(1) A stock exchange registered in Pakistan shall collect advance tax,-
(a) at the rates specified in Division IIA of Part IV of First Schedule from its Members on purchase of shares in lieu of
tax on the commission earned by such Members; and
(b) at the rates specified in Division IIA of Part IV of First Schedule from its Members on sale of shares in lieu of tax on
the commission earned by such Members.
(2) The tax collected under sub-section (1) shall be adjustable.
(3) This section shall not apply from the first day of March, 2019.

Adjustable/
Withholding
Final/
Agent
Section Nature of Payment/Transaction Rate Minimum
Collection of tax by a stock exchange registered in Pakistan

0.02% of
From Members of Stock Exchange on purchase of shares in lieu Stock exchange
purchase value
233A of tax on the commission earned by such Members; registered in A
From Members of Stock Exchange on sale of shares in lieu of tax 0.02% of sale Pakistan
on the commission earned by such Members value
Page 87 of 166
1[ ]
1 Section 233AA omitted by Finance Act, 2021. Earlier it was:

233AA. Collection of tax by NCCPL
NCCPL shall collect advance tax from the members of Stock Exchange registered in Pakistan, margin financiers, trading
financiers and lenders, in respect of margin financing in share business or providing of any margin financing, margin trading
or securities lending under Securities (Leveraged Markets and Pledging) Rules, 2011 in share business at the rate specified in
Division IIB of Part IV of First Schedule:
Provided that the provisions of this section shall not apply to any Mutual Fund specified in sub-clause (2) of clause
(57) of Part I of the Second Schedule.

Adjustable/
Withholding Agent Final/
Section Nature of Payment/Transaction Rate Minimum
Collection of tax by NCCPL National Clearing

233AA From Members Stock Exchange Margin Financiers, trading 10% Company Pakistan A
financiers and Securities lenders. Limited (NCCPL)
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 233AA - COLLECTION OF TAX BY NCCPL)
Page 88 of 166
Section 234 - Tax on motor vehicles
(1) Any person at the time of collecting motor vehicle tax shall also collect advance tax at the rates
specified in Division III of Part IV of the First Schedule.
(2) If the motor vehicle tax is collected in installments, or lump sum the advance tax may also be collected
in installments or lump sum in like manner.
(2A) In respect of motor cars used for more than ten years in Pakistan, no advance tax shall be collected
after a period of ten years.
(3) In respect of a passenger transport vehicle with registered seating capacity of ten or more persons,
advance tax shall not be collected after a period of ten years from the first day of July of the year of
make of the vehicle.
(4) In respect of a goods transport vehicle with registered laden weight of less than 8120 kilograms,
advance tax shall not be collected after a period of ten years from the date of first registration of
vehicle in Pakistan.
(5) Advance tax collected under this section shall be adjustable.
(6) For the purpose of sub-sections (1) and (2) “motor vehicle” shall include the vehicles specified in sub-
section (7) of section 231B.
Responsible
Adjustable
Person /
Section Nature of Payment/Transaction Rates / Final/
Withholding
Minimum
Agent
234 Tax on Motor Vehicles
From plying or hiring of goods transport
including Oil Tankers; (Amended
through 126(I)/2013, SRO 900(I)/2013,
Clause 14A P II, 2nd Sch, again
Rs. 2.50/- per KG A
substituted through SRO 980 of 2013)
Person
collecting
Oil Tankers (SRO 126(I)/2013 dated: 13-
motor vehicle
02-2013)
tax
Reduced rates for goods transport
vehicle with laden weight of 8120 kg or
more after a period ten years from the Rs. 1,200/annum A
date of first registration of the vehicle in
Pakistan
Passenger transport having seating Rs. Per Seat Per annum
capacity of:
a. Four or more persons but less than a. 50

A
ten persons.
b. Ten or more persons but less than b. 100
twenty persons.
c. Twenty persons or more. c. 300
Page 89 of 166
Adjustable/
Withholding
Section Nature of Payment / Transaction Rates Final/
Agent
Minimum
234 All Private Motor Vehicles
Collection on annual basis
Engine Capacity Tax
1. Upto 1000CC Rs. 800
2. 1001cc to 1199cc Rs. 1,500
3. 1200cc to 1299cc Rs. 1,750 Person collecting
A
4. 1300cc to 1499cc Rs. 2,500 motor vehicle tax
5. 1500cc to 1599cc Rs. 3,750
6. 1500cc to 1999cc Rs. 4,500
7. 2000cc & above Rs. 10,000
Motor vehicle tax is collected in lump sum
1. Upto 1000CC Rs. 10,000
2. 1001cc to 1199cc Rs. 18,000
3. 1200cc to 1299cc Rs. 20,000
Person collecting
4. 1300cc to 1499cc Rs. 30,000 A
motor vehicle tax
5. 1500cc to 1599cc Rs. 45,000
6. 1500cc to 1999cc Rs. 60,000
7.2000cc and above Rs. 120,000
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 234: Tax on motor vehicles)
1. Motor vehicles owned by the Federal Government. [Section 49].
2. Motor vehicles owned by a Provincial Government. [Section 49].
3. Motor vehicles owned by a Local Authority. [Section 49].
4. Motorcar used for more than ten years in Pakistan. [Section 234(2A)].
5. Passenger transport vehicle with registered seating capacity of ten or more persons after a period of ten years
from the first day of July of the year of make of the vehicle. [Section 234(3)].
6. Goods transport vehicle with registered laden weight of less than 8120 kilograms after a period of ten years
from the date of first registration of the vehicle in Pakistan. [Section 234(4)].

Page 90 of 166
1[ ]

234A. CNG Stations
(1) There shall be collected advance tax at the rate specified in Division VIB of Part III of the First Schedule on the amount of gas
bill of a Compressed Natural Gas station.
(2) The person preparing gas consumption bill shall charge advance tax under sub section (1) in the manner gas consumption
charges are charged.
(3) The tax collected under this section and under section 235 shall be a minimum tax on the income of a CNG station arising
from the consumption of the gas referred to in sub-section (1).
Explanation.— For removal of doubt, it is clarified that for the purposes of this section tax on income arising from
consumption of gas referred to in sub-section (3) means the tax collected under sub-section (1) which is inclusive of sales tax
and all incidental charges.
Adjustable/
Section Nature of Payment/Transaction Rate Withholding Agent Final/
Minimum
Person preparing Gas consumption
234A On the amount of gas bill of a CNG 4% M
bill
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 234A - CNG STATIONS)

The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction or collection of withholding
Khyber Pakhtunkhwa and Balochistan under paragraph (d) of Article 246 of the Constitution with effect from the 1st day of June, 2018 to
the 30th day of June, 2023 (both days inclusive). [Clause (109A) Part IV, 2nd Schedule]
Page 91 of 166
Section 235 - Electricity consumption
(1) There shall be collected advance tax at the rates specified in 1[Division IV of] Part-IV of the First
Schedule on the amount of electricity bill of a commercial or industrial 2[or domestic] consumer:
3Provided that the provisions of sub-section (1) shall not apply to a domestic consumer of
electricity if his name appears on the Active Taxpayers’ List.
(2) The person preparing electricity consumption bill shall charge advance tax under sub-section (1) in
the manner electricity consumption charges are charged.
4
Explanation.— For removal of doubt, it is clarified that for the purposes of this section electricity
consumption bill referred to in sub-section (2) means electricity bill inclusive of sales tax and all
incidental charges.
(3) Advance tax under this section shall not be collected from a person who produces a certificate from
the Commissioner that his income during tax year is exempt from tax 5[or that he has discharged
advance tax liability 6[under section 147 or whose entire income is subject to final tax regime or
minimum tax regime under any provisions of this Ordinance other than this section].
(4) under this section,-

(a) in the case of a taxpayer other than a company, tax collected upto bill amount of three hundred
and sixty thousand Rupees per annum shall be treated as minimum tax on the income of such
persons and no refund shall be allowed;
(b) in the case of a taxpayer other than a company, tax collected on monthly bill over and above thirty
thousand rupees per month shall be adjustable; and
(c) in the case of a company, tax collected shall be adjustable against tax liability.

Adjustable/ Final/
Section Nature of Payment/Transaction Rate WH Agent
Minimum
MT upto the bill amount
Electricity bill of a commercial or industrial Provided in
of Rs. 360,000 per year
consumer Table below
Person
0% if bill is less preparing Adjustable if monthly
235
Electricity bill of a domestic consumer if his than Rs. 25,000 electricity bill is above Rs. 30,000
name is not appearing on the Active bills
Taxpayers’ List. 7.5% if bill is Rs. Fully adjustable for
25,000 or more companies
Table (for commercial or industrial consumers)

S. No. Gross Amount of Bill Tax
1 Upto Rs. 500 Rs. 0
2 exceeds Rs. 500 but does not exceeds Rs. 20,000 10% of the amount
3 exceeds Rs. 20,000 Rs. 1950 plus 12% of the amount exceeding Rs.
20,000 for commercial consumers Rs. 1950
plus 5% of the amount exceeding Rs. 20,000
for industrial consumers

6 Words “for the tax year” substituted by Finance Act, 2021.
Page 92 of 166
Page 93 of 166
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 235 - ELECTRICITY CONSUMPTION)
1. Consumer being the Federal Government [Section 49].
2. Consumer being a Provincial Government [Section 49].
3. Consumer being a Local Authority [Section 49].
4. Advance tax under this section shall not be collected from a person who produces a certificate from the
Commissioner that his income during tax year is exempt from tax 1[or that he has discharged advance tax
liability for the tax year]. [Section 235(3)].
5. The provisions of section 235, shall not be applicable to the taxpayers 2[ ] registered with sales tax as exporter
or manufacturers of -
(a) carpets;
(b) leather and articles thereof including artificial leather footwear;
(c) surgical goods;
(d) sports goods; and
(e) textile and articles thereof. [Clause (66), Part IV, 2nd Schedule]

2 Words “who fall under the zero rated regime of sales tax and” omitted by The Tax Laws (Amendment) Act, 2020. Earlier it was
omitted by The Tax Laws (Second Amendment) Ordinance, 2019.
Page 94 of 166
1
[]
1 Section 235A omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2014.
235A. Domestic electricity consumption.
(1) There shall be collected advance tax at the rates specified in Division XIX of Part IV of the First Schedule on the amount of
electricity bill of a domestic consumer.
Explanation.— For removal of doubt, it is clarified that for the purposes of this section, electricity consumption bill referred
to in sub-section (2) means electricity bill inclusive of sales tax and all incidental charges.
(2) The person preparing electricity consumption bill shall charge advance tax under sub-section (1) in the manner electricity
consumption charges are charged.
(3) Tax collected under this section shall be adjustable against tax liability.

Adjustable/ Final/
Section Nature of Payment / Transaction Rate Withholding Agent
Minimum
235A Domestic electricity consumption
Where monthly bill is Rs. 75,000/- or more 7.5% Person preparing electricity
A
Where monthly bill is is less than Rs. 75,000/- 0% bills
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 235A - DOMESTIC ELECTRICITY CONSUMPTION)
Page 95 of 166
1[ ]
1 Section 235B omitted by Finance Act, 2020. Earlier it was:

235B. Tax on steel melters and composite units.
(1) There shall be collected tax from every steel melter, and composite steel units, registered for the purpose of Chapter XI of Sales
Tax Special Procedure Rules, 2007 at the rate of one rupee per unit of electricity consumed for the production of steel billets,
ingots and mild steel (MS products) excluding stainless steel.
(2) The person preparing electricity consumption bill shall charge and collect the tax under sub-section (1) in the manner electricity
consumption charges are charged and collected.
(3) The tax collected under sub- section (1) shall be deemed to be the tax required to be deducted under sub-section (1) of section
153, on the payment for local purchase of scrap.
(4) Tax collected under sub-section (1) shall be non-adjustable and credit of the same shall not be allowed to any person.
Adjustable/
Section Nature of Payment/Transaction Rate Withholding Agent
Final/ Minimum
Tax on steel melters and composite units
Rs. 1/- per unit of
Every steel melter and composite units, registered for Person preparing
235B electricity consumed M
the purpose of Chapter XI of the Sales Tax Special electricity bills
for the production
Procedure Rules, 2007
Page 96 of 166
Section 236 - Telephone and internet users
(1) Advance tax at the rates specified in 1[Division V] Part IV of the First Schedule shall be collected on the
amount of –
(a) telephone bill of a subscriber;
(b) prepaid cards for telephones;
(c) sale of units through any electronic medium or whatever form;
(d) internet bill of a subscriber; and
(e) prepaid cards for internet.
(2) The person preparing the telephone or internet bill shall charge advance tax under sub-section (1) in
the manner telephone or internet charges are charged.
(3) The person issuing or selling prepaid cards for telephones or internet shall collect advance tax under
sub-section (1) from the purchasers at the time of issuance or sale of cards.
(3A) The person issuing or selling units through any electronic medium or whatever form shall collect
advance tax under sub-section (1) from the purchaser at the time of issuance or sale of units.
(4) Advance tax under this section shall not be collected from Government, a foreign diplomat, a
diplomatic mission in Pakistan, or a person who produces a certificate from the Commissioner that
his income during the tax year is exempt from tax.

Adjustable
Section Nature of Payment / Transaction Rate Withholding Agent / Final/
Minimum
Telephone
Telephone Subscribers (Bill
10% Person preparing
exceeding Rs. 1,000/-)
2 telephone bills /
[10% for tax year 2022 and
issuing or selling
8% onwards] of the amount of
236 In the case of subscriber of prepaid card or sale
bill or sales price of internet A
internet, mobile telephone and of units through any
pre-paid card or prepaid
pre-paid internet or telephone electronic medium
telephone card or sale of units
card or whatever form
through any electronic
for mobile phones
medium or whatever form
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236 - TELEPHONE USERS)

1. Subscriber being the Federal Government [Section 49].
2. Subscriber being a Provincial Government [Section 49].
3. Subscriber being a local authority [Section 49].
4. Subscriber, which is a foreign diplomatic mission in Pakistan [Section 236(4)].
5. Subscriber, who is a foreign diplomat [Section 236(4)].
6. Subscriber whose income is exempt from tax and produces a certificate from the Commissioner to this effect.
[Section 236(4)].
1 Word inserted by Finance Act, 2021.

2 Figure “12.5%” substituted by Finance Act, 2021.
Page 97 of 166
Section 236A - Advance tax at the time of sale by auction
(1) Any person making sale by public auction or auction by a tender, of any property or goods (including
property or goods confiscated or attached) either belonging to or not belonging to the Government,
local Government, any authority, a company, a foreign association declared to be a company under
sub clause (vi) of clause (b) of sub-section (2) of section 80, or a foreign contractor or a consultant or
a consortium or Collector of Customs or Commissioner Inland Revenue or any other authority, shall
collect advance tax, computed on the basis of sale price of such property and at the rate specified in
Division VIII of Part IV of the First Schedule, from the person to whom such property or goods are
being sold.
1
Explanation.—For the removal of doubt it is clarified for the purpose of this section that—
(a) the expression “sale by public auction or auction by a tender” includes renewal of a license
previously sold by public auction or auction by a tender; and
(b) where payment is received in installments, advance tax is to be collected with each
installment.
(2) The credit for the tax collected under sub-section (1) in that tax year shall, subject to the provisions
of section 147, be given in computing the tax payable by the person purchasing such property in the
relevant tax year or in the case of a taxpayer to whom section 98B or section 145 applies, the tax year,
in which the “said date” as referred to in that section, falls or whichever is later.
(3) Notwithstanding the provisions of sub-section (2), tax collected on a lease of the right to collect tolls
shall be final tax.
Explanation.- For the purposes of this section, sale of any property includes the awarding of any lease
to any person, including a lease of the right to collect tolls, fees or other levies, by whatever name
called.
Withholding Adjustable/ Final/
Section Nature of Payment/Transaction Rate
Agent Minimum
A
Advance tax at the time of sale by auction
10% (F for lease of the
(including confiscated or attached)
236A Every person right to collect tolls)
In case of immovable property sold by
5% A
auction
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236A - Advance tax at the time of
sale by auction)
2. The provisions of section 236A shall not apply in respect of auction of franchise rights to participating teams
in a national or international league organized by any board or other organization established by the
Government in Pakistan for the purposes of controlling, regulating or encouraging major games and sports
recognized by the Government with effect from the first day of July, 2019. [Clause (95A), Part IV, 2nd Schedule]

Page 98 of 166
1
3. The provisions of sections in Division III of Part V of Chapter X and Chapter XII of this Ordinance for deduction
2[ ]

2 Section 236B omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2010.
236B. Advance tax on purchase of air ticket.
(1) There shall be collected advance tax at the rate specified in Division IX of Part IV of the First Schedule, on the purchase of
gross amount of domestic air ticket;
Provided that this section shall not apply to routes of Baluchistan coastal belt, Azad Jammu and Kashmir, Federally
Administered Tribal Areas, Gilgit-Baltistan and Chitral.
(2) The airline issuing air ticket shall charge advance tax under sub-section (1) in the manner air ticket charges are charged.
(2A) The mode, manner and time of collection shall be as may be prescribed.
(3) The advance tax collected under sub-section (1) shall be adjustable.

Adjustable/
Minimum
236B Advance tax on purchase of air ticket 5% Airline issuing ticket A
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236B - ADVANCE TAX ON PURCHASE OF AIR TICKET)
Page 99 of 166
Section 236C - Advance Tax on sale or transfer of immovable property
(1) Any person responsible for registering1[, recording] or attesting transfer of any immovable property
shall at the time of registering2[, recording] or attesting the transfer shall collect from the seller or
transferor advance tax at the rate specified in Division X of Part IV of the First Schedule:
3
Provided that this sub-section shall not apply to a seller, being the dependant of a Shaheed
belonging to Pakistan Armed Forces or a person who dies while in the service of the Pakistan Armed
Forces or the service of Federal or Provincial Government, in respect of first sale of immovable
property acquired from or allotted by the Federal Government or Provincial Government or any
authority duly certified by the official allotment authority, and the property acquired or allotted is in
recognition of or for services rendered by the Shaheed or the Person who dies in service:
4
Provided further that if the seller or transferor is a non-resident individual holding Pakistan
Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) or Computerized National ID
Card (CNIC) who had acquired the said immovable property through a Foreign Currency Value Account
(FCVA) or NRP Rupee Value Account (NRVA) maintained with authorized banks in Pakistan under the
foreign exchange regulations issued by the State Bank of Pakistan, the tax collected under this section
from such persons shall be final discharge of tax liability in lieu of capital gains taxable under section
37 earned by the seller or transferor from the property so disposed of.
5
Explanation,—For removal of doubt, it is clarified that the person responsible for registering,
recording or attesting transfer includes person responsible for registering, recording or attesting
transfer for local authority, housing authority, housing society, co-operative society 6[, public and
private real estate projects registered/governed under any law, joint ventures, private commercial
concerns] and registrar of properties.
(2) The Advance tax collected under sub-section (1) shall be adjustable:
7
Provided that where immovable property referred to in sub-section (1) is acquired and
disposed of within the same tax year, the tax collected under this section shall be minimum tax.
8
[]
9
(3) Advance tax under sub-section (1) shall not be collected if the immovable property is held for a period
exceeding 10[four] years.
11
(4) Sub-section (1) shall not apply to;-
(a) a seller, if the seller is dependent of:
(i) a Shaheed belonging to Pakistan Armed Forces; or
(ii) a person who dies while in the service of the Pakistan Armed Forces or the Federal
and Provincial Government; and

3 Proviso inserted by Tax Laws (Amendment) Ordinance, 2016.
6 Words inserted by Finance Act, 2021
(3) The advance tax under this section shall not be collected in the case of Federal Government, Provincial Government or a Local
Government.
10 Word “five” substituted by Finance Act, 2020.
11 Sub-section (4) inserted by Income Tax (Amendment) Act, 2016. Earlier it was omitted by Tax Laws (Amendment) Ordinance, 2016.
Earlier it was inserted by Income Tax (Amendment) Ordinance, 2016.
Page 100 of 166
(b) to the first sale of immovable property which has been acquired or allotted as an original
allotted, duly certified by the official allotment authority.
Rate Withholding Adjustable/ Final/
Section Nature of Payment/Transaction
s Agent Minimum
Advance Tax on sale or Transfer of Person A
Immovable Property. responsible for (M incase immovable
236C 1% registering , property is acquired
(Applicable only where immovable property recording or and disposed of within
is held for a period less than 4 years) attesting transfer the same tax year)
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236C - Advance Tax on sale or
transfer of immovable property)
1. Advance tax under sub-section (1) shall not be collected if the immovable property is held for a period
exceeding four years. [Section 236C(3)]
2. Section 236C(1) shall not apply to;-
(a) a seller, if the seller is dependent of:
(i) a Shaheed belonging to Pakistan Armed Forces; or
(ii) a person who dies while in the service of the Pakistan Armed Forces or the Federal and Provincial
Government; and
(b) to the first sale of immovable property which has been acquired or allotted as an original allotted, duly
certified by the official allotment authority. [Section 236C(4)]
3. The provision of section 236C shall not apply to “Pakistan International Sukuk Company Limited. [Clause (97),
4. Clarification available in Circular 19 of 2016.
5. 1Profit and gains accruing to persons mentioned in proviso to sub-section (1) of section 236C in respect of
first sale of immovable property acquired from or allotted by the Federal Government or Provincial
Government or any authority duly certified by the official allotment authority, and the property acquired
or allotted is in recognition of services rendered by the Shaheed or the person who dies in service. [Clause
(114B), Part I, 2nd Schedule]
3
[]
1 Clause (114B) inserted by Finance Act, 2019.

3 Section 236D omitted by Finance Act, 2020. Earlier it was:
236D. Advance tax on functions and gatherings.
(1) Every prescribed person shall collect advance tax at the rate specified in Division XI of Part IV of the First Schedule on the
total amount of the bill from a person arranging or holding a function in a marriage hall, marquee, hotel, restaurant,
commercial lawn, club, a community place or any other place used for such purpose.
(2) Where the food, service or any other facility is provided by any other person, the prescribed person shall also collect
advance tax on the payment for such food, service or facility at the rate specified in Division XI of Part IV of the First
Schedule form the person arranging or holding the function.
(3) The advance tax collected under sub-section (1) and sub-section (2) shall be adjustable.
(4) In this section,-
(a) “function” include any wedding related event, a seminar, a workshop, a session, an exhibition, a concert, a show,
a party or any other gathering held for such purpose; and
(b) “prescribed person” includes the owner, a lease-holder, an operator or a manager of a marriage hall, marquee,
hotel, restaurant, commercial lawn, club, a community place or any other place used for such purpose.
Page 101 of 166
Adjustable/
Withholding
Section Nature of Payment/Transaction Rate Final/
Agent
Minimum
236D Advance tax on functions and gatherings
The owner, lease-holder, operator or manager of a marriage hall, marquee, hotel, Owner, lease
restaurant, commercial lawn, club, a community place or any other place used for 5% holder, operator A
wedding related event, seminar, workshop, session exhibition concert show, party or manager
or any other gathering.
Provided that the rate for the function of marriage in a marriage hall, marquee, hotel, restaurant, commercial lawn, club, a
community place or any other place used for such purpose shall be as set out in the Table below:-
TABLE
Sr. # Rate of tax
1. 5% of the bill ad valorem For Islamabad, Lahore, Multan, Faisalabad, Rawalpindi, Gujranwala, Bahawalpur, Sargodha, Sahiwal,
or Rs. 20,000 per function, Shekhupura, Dera Ghazi Khan, Karachi, Hyderabad, Sukkar, Thatta, Larkana, Mirpur Khas,
whichever is higher. Nawabshah, Peshawar, Mardan, Abbotabad, Kohat, Dera Ismail Khan, Quetta, Sibi, Loralai, Khuzdar,
Dera Murad Jamali and Turbat.
2. 5% of the bill ad valorem
or Rs. 10,000 per function, For cities other than those mentioned above
whichever is higher
Provided further that the rate for the function of marriage in a marriage hall, marquee or a community place with the
total function area less than 500 square yards or, in case of a multi storied premises, with the largest total function area on one
floor less than 500 square yards, shall be 5% of the bill ad valorem or Rs. 5,000 per function whichever is higher.
Page 102 of 166
1
[]
2
[]
1 Section 236E omitted by Finance Act, 2016. Earlier it was inserted by Finance Act, 2013.
236E. Advance tax on foreign-produced TV plays and serials.
(1) Any licensing authority certifying any foreign TV drama serial or a play dubbed in Urdu or any other regional language, for
screening and viewing on any landing rights channel, shall collect advance tax at the rates specified in Division XII of Part IV of
the First Schedule.
2 Section 236F omitted by Finance Act, 2020. Earlier it was:

236F. Advance tax on cable operators and other electronic media.
(1) Pakistan Electronic Media Regulatory Authority, at the time of issuance of licence for distribution services or renewal of the
licence to a licencee, shall collect advance tax at the rate specified in Division XIII of Part IV of the First Schedule.
(2) The tax collected under sub-section (1) shall be adjustable.
(3) For the purpose of this section, “cable television operator” “DTH”, “Distribution Services”, “electronic media”, “IPTV”, “loop
holder”, “MMDS”, “mobile TV”, shall have the same meanings as defined in Pakistan Electronic Media Regulatory Authority
Ordinance, 2002 (XIII of 2002) and rules made thereunder.
Adjustable/ Final/
Section Nature of Payment/Transaction Rates Withholding Agent
Minimum
236F Advance tax on cable operators and other Rates as specified in Division
PEMRA A
electronic media XIII, Part IV, 1st Schedule
License Category as
provided in PEMRA Tax on License Fee Tax on Renewal
Rules
H Rs. 7500 Rs. 10,000
H-I Rs. 10,000 Rs. 15,000
H-II Rs. 25,000 Rs. 30,000
R Rs. 5,000 Rs. 12,000
B Rs. 5,000 Rs. 40,000
B-1 Rs. 30,000 Rs. 35,000
B-2 Rs. 40,000 Rs. 45,000
B-3 Rs. 50,000 Rs. 75,000
B-4 Rs. 75,000 Rs. 100,000
B-5 Rs. 87,500 Rs. 150,000
B-6 Rs. 175,000 Rs. 200,000
B-7 Rs. 262,500 Rs. 300,000
B-8 Rs. 437,500 Rs. 500,000
B-9 Rs. 700,000 Rs. 800,000
B-10 Rs. 875,500 Rs. 900,000
(2) The rate of tax to be collected by Pakistan Electronic Media Regulatory Authority under section 236F in the case of IPTV, FM
Radio, MMDS, Mobile TV, Mobile Audio, Satellite TV Channel and Landing Rights, shall be 20 percent of the permission fee or
renewal fee, as the case may be.
(3) In addition to tax collected under paragraph (2) Pakistan Electronic Media Regulatory Authority shall collect tax at the rate of
fifty per cent of the permission fee or renewal fee, as the case may be, from every TV Channel on which foreign TV drama serial
or a play in any language, other than English, is screened or viewed.
Page 103 of 166

Section 236G - Advance tax on sales to distributors, dealers and wholesalers
(1) Every manufacturer or commercial importer of 1[pharmaceuticals, poultry and animal feed, edible oil
and ghee, auto-parts, tyres, varnished, chemicals, cosmetics, IT equipments,] electronics, sugar,
cement, iron and steel products, fertilizer, motorcycles, pesticides, cigarettes, glass, textile,
beverages, paint or foam sector, at the time of sale to distributors, dealers and wholesalers, shall
collect advance tax at the rate specified in Division XIV of Part IV of the First Schedule, from the
aforesaid person to whom such sales have been made.
(2) Credit for the tax collected under sub-section (1) shall be allowed in computing the tax due by the
distributors, dealer or wholesaler on the taxable income for the tax year in which the tax was
collected.]
Adjustable
Section Nature of Payment/Transaction Rates Withholding Agent / Final/
Minimum
236G Advance tax on sales to distributors, dealers & 0.7% [Fertilizer]
wholesalers
Sale of pharmaceuticals, poultry and animal feed, 0.1% [Other than
edible oil and ghee, auto-parts, tyres, varnished, fertilizer]
chemicals, cosmetics, IT equipments, electronics,  Manufacturer
A
sugar, cement, iron and steel products, fertilizer, 0.25% [on sale of  Commercial Importer
motorcycles, pesticides, cigarettes, glass, textile, fertilizer if person
beverages, paint or foam sector to distributors, appearing in ATL
dealers and wholesalers list of Income Tax
and Sales Tax ]
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236G - ADVANCE TAX ON SALES TO
DISTRIBUTORS, DEALERS AND WHOLESALERS)
Section 236H - Advance tax on sales to retailers

(1) Every manufacturer, distributors, dealers, wholesaler or commercial importer of 3[pharmaceuticals,
poultry and animal feed, edible oil and ghee, auto-parts, tyres, varnished, chemicals, cosmetics, IT
equipments,] electronics, sugar, cement, iron and steel product, 4[ ] motorcycles, pesticides,
cigarettes, glass, textile, beverages, paint or foam sector, at the time of sale to retailers 5[and every
distributor or dealer to another wholesaler in respect of the said sectors], shall collect advance tax at
the rate specified in Division XV of Part IV of the First Schedule, from the aforesaid person to whom
such sales have been made..
(2) Credit for the tax collected under sub-section (1) shall be allowed in computing the tax due by the
retailer on the taxable income for the tax year in which the tax was collected.

4 Word “fertilizer” omitted by Finance Act, 2015.
Page 104 of 166
Adjustable
Section Nature of Payment / Transaction Rates Withholding Agent / Final/
Minimum
236H Advance tax on sales to retailers
Sale of pharmaceuticals, poultry and animal
feed, edible oil and ghee, auto-parts, tyres,  Manufacturer
varnished, chemicals, cosmetics, IT equipments,  Distributor
electronics, sugar, cement, iron and steel 0.5%  Dealer A
product, motorcycles, pesticides, cigarettes,  Wholesaler
glass, textile, beverages, paint or foam to  Commercial importer
retailers and every distributor or dealer to
another wholesaler
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236H - Advance Tax on Sales to
Retailers)
1. The provisions of clause (a) of section 165, shall not apply in case of manufacturer, distributor, dealer and
wholesaler required to collect advance tax under sub section (1) of section 236H. [Clause 81, Part IV, 2nd
Schedule]1
3[ ]
1 Clause 81, Part IV, 2nd Schedule omitted by Finance Act, 2019.
3 Section 236HA omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2018.
236HA. Tax on sale of certain petroleum products.
(1) Every person selling petroleum products to a petrol pump operator or distributer, where such operator or distributer is not
allowed a commission or discount, shall collect advance tax on ex-depot sale price of such products at the rate specified in
Division XVA of Part IV of the First schedule.
(2) The tax deductible under sub-section (1) shall be a final tax on the income arising from the sale of petroleum products to
which sub-section (1) applies.
Adjustable/
Minimum
Every person selling petroleum products
236HA Rate of Collection tax of ex-depot sale price 0.5% F
to petrol pump operator or distributer
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236HA - TAX ON SALE OF CERTAIN PETROLEUM PRODUCTS)
Page 105 of 166

Page 106 of 166
Section 236I - Collection of advance tax by education institutions
(1) There shall be collected advance tax 1[from a person not appearing on the active taxpayers' list] at the
rate specified in Division XVI of Part-IV of the First Schedule on the amount of fee paid to an
educational institution.
(2) The person preparing fee voucher or challan shall charge advance tax under sub-section (1) in the
manner the fee is charged.
(3) Advance tax under this section shall not be collected from a person on an amount which is paid by
way of scholarship or where annual fee does not exceed two hundred thousand rupees.
(4) The term “fee” includes, tuition fee and all charges received by the educational institution, by
whatever name called, excluding the amount which is refundable.
(5) Tax collected under this section shall be adjustable against the tax liability of either of the parents or
guardian making payment of the fee.
(6) Advance tax under this section shall not be collected from a person who is a non-resident and,
(i) furnishes copy of passport as an evidence to the educational institution that during previous tax
year, his stay in Pakistan was less than one hundred eighty-three days;
(ii) furnishes a certificate that he has no Pakistan-source income; and
(iii) the fee is remitted directly from abroad through normal banking channels to the bank account of
the educational institution.

Adjustable
Withholding
Section Nature of Payment/Transaction Rate / Final/
Agent
Minimum
Collection of advance tax by educational 5%
institutions only for the person whose Education
236I A
name is not appearing in institutions
Where annual fee exceeds Rs. 200,000/- the active taxpayers’ list
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236I - COLLECTION OF ADVANCE TAX BY
EDUCATION INSTITUTIONS)

Page 107 of 166
1[ ]
Section 236K - Advance tax on purchase or transfer of immovable property

(1) Any person responsible for registering2[, recording] or attesting transfer of any immovable property
shall at the time of registering3[, recording] or attesting the transfer shall collect from the purchaser
or transferee advance tax at the rate specified in Division XVIII of Part IV of the First Schedule.
4
Explanation,—For removal of doubt, it is clarified that the person responsible for registering,
recording or attesting transfer includes person responsible for registering, recording or attesting
transfer for local authority, housing authority, housing society, co-operative society 5[public and
private real estate projects registered/governed under tany law, joint ventures, private commercial
concerns] and registrar of properties.
(2) The advance tax collected under sub-section (1) shall be adjustable:
6
Provided further that if the buyer or transferee is a non-resident individual holding Pakistan
Origin Card (POC) or National ID Card for Overseas Pakistanis (NICOP) or Computerized National ID
Card (CNIC) who has acquired the said immovable property through a Foreign Currency Value
Account (FCVA) or NRP Rupee Value Account (NRVA) maintained with authorized banks in Pakistan
under the foreign exchange regulations issued by the State Bank of Pakistan, the tax collected under
this section from such persons shall be final discharge of tax liability for such buyer or transferee.
7
[(3) Any person responsible for collecting payments in installments for purchase or allotment of any
immovable property where the transfer is to be effected after making payment of all installments,
shall at the time of collecting installments collect from the allotee or transferee advance tax at the
rate specified in Division XVIII of Part IV of the First Schedule:
8
Provided that where tax has been collected along with instalments, no further tax under
this section shall be collected at the time of transfer of property in the name of buyer from whom
tax has been collected in installment which is equal to the amount payable in this section.
9
[ ]
1 Section 236J omitted by Finance Act, 2020. Earlier it was:

236J. Advance tax on dealers, commission agents and arhatis etc.
(1) Every market committee shall collect advance tax from dealers, commission agents or arhatis, etc. at the rate specified in
Division XVII of Part-IV of the First Schedule at the time of issuance or renewal of licences.
(3) In this section “market committee” includes any committee or body formed under any provincial or local law made for the
purpose of establishing, regulating or organizing agricultural, livestock and other commodity markets.
Adjustable/ Final/
Section Nature of Payment / Transaction Rates Withholding Agent
Minimum
236J Advance tax on dealers, commission agents and
 Every Market
arhatis etc 100,000 pa
Committee
Group or class A 75,000 pa
A
Group or class B 50,000 pa
 Commodity Regulatory
Group or class C 50,000 pa
Authority
Any other category

Page 108 of 166
(4) Nothing contained in this section shall apply to a scheme introduced by the Federal Government, or
Provincial Government or an Authority established under a Federal or Provincial law for expatriate
Pakistanis:
Provided that the mode of payment by the expatriate Pakistanis in the said scheme or
schemes shall be in the foreign exchange remitted from outside Pakistan through normal banking
channels.
Rate Adjustable/
Responsible Person /
Section Nature of Payment/Transaction Final/
Withholding Agent
Minimum
Advance tax on purchase or transfer of
Person responsible for
immovable property
1% of the fair registering, recording or
236K At the time of registering, recording or attesting A
market value attesting transfer of
the transfer of immovable property, collect
immovable property
from the purchaser or transferee
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236K - Advance Tax on sale or
transfer of immovable property)
2. The provisions of sections 147, 150A, 151, 155 and 236K shall not apply to “The second Pakistan
recipient. [Clause (96), Part IV, 2nd Schedule]
2[ ]
(3)
The advance tax under this section shall not be collected in the case of the Federal Government, a Provincial Government, a
Local Government or a foreign diplomatic mission in Pakistan.
2 Section 236L omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2014.
236L. Advance tax on purchase of international air ticket.
(1) Every airline, issuing ticket for journey originating from Pakistan, shall collect advance tax at the rates specified in Division
XX of Part IV of the First Schedule, on the gross amount of international air tickets issued to passengers booking one-way or
return, from Pakistan.
(2) The airline issuing air ticket shall collect or charge advance tax under sub-section (1) in the manner air ticket charges are
collected or charged, either manually or electronically.
(3) The mode, manner and time of collection under sub-section (1) and time of collection shall be as may be prescribed.

Adjustable/
Withholding
Section Nature of Payment/Transaction Rates Final/
Agent
Minimum
Page 109 of 166
Advance tax on purchase of international air ticket
Collect advance tax from passenger at the time of
issuing international ticket
Type of Ticket Every airline

236L A
First/Executive Class issuing the ticket
Others excluding Economy
Rs. 16,000 per person
Economy
Rs. 12,000 per person
0
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236L - ADVANCE TAX ON PURCHASE OF INTERNATIONAL AIR
TICKET)
Page 110 of 166

Section 236O - Advance tax under this chapter
The advance tax under this chapter shall not be collected or deducted —
(a) the Federal Government or a Provincial Government;
(b) a foreign diplomat or a diplomatic mission in Pakistan; or
(c) a person who produces a certificate from the Commissioner that his income during the tax
year is exempt.
1[ ]
1 Section 236P omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2015.
236P. Advance tax on banking transactions otherwise than through cash.
(1) Every banking company shall collect advance adjustable tax from a person whose name is not appearing in the active
taxpayers' list at the time of sale of any instrument, including demand draft, pay order, special deposit receipt, cash deposit
receipt, short term deposit receipt, call deposit receipt, rupee traveller‘s cheque or any other instrument of such nature.
(2) Every banking company shall collect advance adjustable tax from a 1[person whose name is not appearing in the active
taxpayers' list] at the time of transfer of any sum through cheque or clearing, interbank or intra bank transfers through
cheques, online transfer, telegraphic transfer, mail transfer, direct debit, payments through internet, payments through
mobile phones, account to account funds transfer, third party account to account funds transfers, real time account to
account funds transfer, real time third party account to account fund transfer, automated teller machine (ATM) transfers, or
any other mode of electronic or paper based funds transfer.
(3) The advance tax under this section shall be collected at the rate specified in Division XXI of Part IV of the First Schedule, where
the sum total of payments for all transactions mentioned in sub-section (1) or subsection (2), as the case may be, exceed fifty
thousand rupees in a day.
Explanation.- For removal of doubt, it is clarified that the said fifty thousand rupees shall be aggregate withdrawals from all
the bank accounts in a single day.
(4) Advance tax under this section shall not be collected in the case of payments made for Federal, Provincial or local Government
taxes.

Adjustable/
Withholding
Section Nature of Payment/Transaction Rate Final/
Agent
Minimum
Advance tax on banking transactions otherwise than through cash
(i) Collect advance tax at the time of sale of any instrument, including
demand draft, pay order, special deposit receipt, cash deposit receipt,
short term deposit receipt, call deposit receipt, rupee traveller‘s cheque 0.6%
or any other instrument of such nature.
only for the
(ii) Collect advance tax at the time of transfer of any sum through cheque person whose Every banking
236P A
or clearing, interbank or intra bank transfers through cheques, online name is not company
transfer, telegraphic transfer, mail transfer, direct debit, payments appearing in
through internet, payments through mobile phones, account to account the active
funds transfer, third party account to account funds transfers, real time taxpayers’ list
account to account funds transfer, real time third party account to
account fund transfer, automated teller machine (ATM) transfers, or any
other mode of electronic or paper based funds transfer.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236P - Advance tax on banking transactions otherwise than through
cash)
1. The provisions of sections 231A, 231AA and 236P shall not apply to a Pak Rupee Account in a tax year to the extent of foreign
remittances credited into such account during that tax year. [Clause (101AA), Part IV, 2nd Schedule]
3. The provisions of section 236P shall not apply at the time of transfer of any sum to the Supreme Court of Pakistan – Diamer Bhasha &
5. The provision of section 236P shall not apply to special convertible rupee account (SCRA) of a non-resident company having no
permanent establishment in Pakistan. [Clause (112) Part IV, 2nd Schedule]
Page 111 of 166
Section 236Q - Payment to residents for use of machinery and equipment
(1) Every prescribed person making a payment in full or in part including a payment by way of advance
to a resident person for use or right to use industrial, commercial and scientific equipment shall
deduct tax from the gross amount at the rate specified in Division XXIII of Part IV of the First Schedule.
(2) Every prescribed person making a payment in full or in part including a payment by way of advance
to a resident person on account of rent of machinery shall deduct tax from the gross amount at the
rate specified in Division XXIII of Part IV of the First Schedule.
(3) The tax deductible under sub-sections (1) and (2) shall be 1[minimum] tax on the income of such
resident person.
(4) In this section “prescribed person” means a prescribed person as defined in sub-section (7) of section
153.
(5) The provisions of sub-section (1) and (2) shall not apply to—
(a) agricultural machinery; and
(b) machinery leased by a leasing company, an investment bank or a modaraba or a scheduled bank
or a development finance institution in respect of assets owned by the leasing company or an
investment bank or a modaraba or a scheduled bank or a development finance institution.

Section Nature of Payment/Transaction Rate Withholding Agent A/F/M
Payment to residents for use of machinery and equipment
Payment on account of: Federal Govt., Company,
 use or right to use industrial, commercial and AOP constituted under
scientific equipment the law, NPO, Foreign
 rent of machinery contractor or consultant,
shall deduct tax from the gross amount Consortium or Joint
Venture, AOP &
236Q This advance tax is not applicable to: 10% Individual having M
a. agricultural machinery; and turnover of Rs. 100m or
b. machinery leased by a leasing company, an investment above, Person registered
bank or a modaraba or a scheduled bank or a under the Sales Tax Act,
development finance institution in respect of assets 1990 having turnover of
owned by the leasing company or an investment bank or a Rs. 100m or above,
modaraba or a scheduled bank or a development finance Builders, Developers
institution.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 236Q - Payment to Residents for
use of Machinery and Equipment.
1. The provisions of section 151, 153, 233 and 236Q shall not apply to special purpose vehicle for the purpose
of securitization or issue of sukuks. [Clause (38), Part IV, 2nd Schedule]
6. The provisions of section 236P shall not apply to a non-resident rupee account repatriable (NRAR) or a foreign currency account
maintained with a banking company in Pakistan of a non-resident individual investing in a debt instrument, whether conventional
or shariah compliant, issued by the Federal Government under the Public Debt Act, 1944. [Clause (112A) Part IV, 2nd Schedule]
8. The provisions of section 236P shall not apply at the time of transfer of any sum to The Prime Minister’s COVID-19 Pandemic Relief
Fund-2020.] [Clause (117) Part IV, 2nd Schedule]
Page 112 of 166
1[ ]
1 Section 236R omitted by Finance Act, 2020. Earlier it was:

236R. Collection of advance tax on education related expenses remitted abroad.
(1) There shall be collected advance tax at the rate specified in Division XXIIV of Part-IV of the First Schedule on the amount of
education related expenses remitted abroad.
(2) Banks, financial institutions, foreign exchange companies or any other person responsible for remitting foreign currency
abroad shall collect advance tax from the payer of education related expenses.
(3) Tax collected under this section shall be adjustable against the income of the person remitting payment of education related
expenses.
(4) For the purpose of this section, “education related expenses” includes tuition fee, boarding and lodging expenses, any payment
for distant learning to any institution or university in a foreign country and any other expense related or attributable to foreign
education.
Rates Adjustable/
Section Nature of Payment / Transaction Withholding Agent Final/
Minimum
Collection of advance tax on education
related expenses remitted abroad 5% of the total Banks, financial institutions, foreign
236R Collect advance tax from the payer of education related exchange companies or any other person A
education related expenses remitted expenses responsible for remitting foreign currency
abroad.
Page 113 of 166

1[ ]
2[ ]
3[ ]
1 Section 236S omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2015.
236S. Dividend in specie.
Every person making payment of dividend-in-specie shall collect tax from the gross amount of the dividend in specie paid at the
rate specified in Division I of Part III of the First Schedule.
Adjustable/
Withholding
Agent
Minimum
150 Dividend
a) in case of dividend paid by Independent Power 1[Producers] where such
dividend is a pass through item under an Implementation Agreement or
Power Purchase Agreement or Energy Purchase Agreement and is required 7.5% F
to be reimbursed by Central Power Purchasing Agency (CPPA-G) or its
predecessor or successor entity.
1(ba) in case of a person receiving dividend from a company where no tax
is payable by such company, due to exemption of income or carry forward 25% Every Person F
of business losses
b) mutual funds and cases other than those mentioned in clauses (a) and
15% F
(ba) above
In case of a stock fund if dividend receipts of the fund are less than capital
12.5% F
gains,
Tax Rate on dividend received by an individual from a Rental REIT Scheme 7.5% F
Person Stock Fund Money market Fund, Income Fund or , REIT

Scheme or any other fund
(1) (2) (3)
Individual 12.5% 12.5%
Company 12.5% 15%
AOP 12.5% 12.5%
Provided further that in case of a stock fund if dividend receipts of the fund are less than capital gains, the rate of
tax deduction shall be 12.5%.
Provided further that if a Developmental REIT Scheme with the object of development and construction of
residential buildings is set up by thirtieth day of June, 2020, rate of tax on dividend received by a person from such
Developmental REIT Scheme shall be reduced by fifty percent for three years from the date of setting up of the said Scheme:
Provided further that the rate of tax on dividend received by a person, other than a company, from a money market
mutual fund shall be 10%, if the amount of dividend does not exceed two and a half million Rupees:
Provided also that the rate of tax on dividend received by an individual, from a Rental REIT Scheme shall be 7.5%.
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (SECTION 236S - DIVIDEND IN SPECIE).

2 Section 236T omitted by Finance Act, 2016. Earlier it was inserted by Finance Act, 2015.
236T. Collection of tax by Pakistan Mercantile Exchange Limited (PMEX).
(1) Pakistan Mercantile Exchange Limited(PMEX) shall collect advance tax—
(a) at the rates specified in Division XXII of Part IV of First Schedule from its members on purchase of futures commodity
contracts;
(b) at the rates specified in Division XXII of Part IV of First Schedule from its members on sale of futures commodity
contracts; and
(2) The tax collected under clauses (a) and (b) of sub-section (1) shall be an adjustable tax.
3 Section 236U omitted by Finance Act, 2020. Earlier it was:
236U. Advance tax on insurance premium.
(1) Every insurance company shall collect advance tax at the time of collection of insurance premium from 3[a person whose name
is not appearing in the active taxpayers' list] in respect of general insurance premium and life insurance premium, at the rates
specified in Division XXV of Part IV of the First Schedule.
Page 114 of 166
1[ ]
(2) Insurance premium collected through agents of the insurance company shall be treated to have been collected by the insurance
company.
Withholding Adjustable/
Section Nature of Payment / Transaction Rates
Agent Final/ Minimum
236U Advance tax on insurance premium
1. General insurance premium 4% only for the person whose
name is not appearing in
Life insurance premium if exceeding Rs 0.3 million per Insurance A
2. 1% the active taxpayers’ list
annum Company
3. Others 0%
1 Section 236V omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2016.
236V. Advance tax on extraction of minerals.
(1) There shall be collected advance tax at the rate specified in Division XXVI of Part-IV of the First Schedule on the value of
minerals extracted, produced, despatched and carried away from the licensed or leased areas of the mines.
(2) Advance tax under sub-section (1) shall be collected by the provincial authority collecting royalty per metric ton from the
lease-holder of mines or any person extracting minerals.
(4) The value of the minerals for the purpose of this section shall be as specified by the Board.

Adjustable/
Minimum
Provincial authority collecting
royalty per metric ton from the
236V Advance tax on extraction of minerals 5% A
lease-holder of mines / any person
extracting minerals
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (SECTION 236V - ADVANCE TAX ON EXTRACTION OF MINERALS)
Page 115 of 166
1[ ]
2[ ]
1 Section 236X omitted by Finance Act, 2020. Earlier it was:

236X. Advance tax on tobacco.
(1) Pakistan Tobacco Board or its contractors, at the time of collecting cess on tobacco, directly or indirectly, shall collect
advance tax at the rate of five percent of the purchase value of tobacco from every person purchasing tobacco including
manufacturers of cigarettes.
(2) Tax collected under this section shall be adjustable.
Adjustable/
Section Nature of Payment / Transaction Rate Withholding Agent
Final/ Minimum
Pakistan Tobacco Board / Contractors of
236X Advance Tax on tobacco 5% A
Pakistan Tobacco Board
2 Section 236Y omitted by Finance Act, 2021. Earlier it was inserted by Finance Act, 2018.
236Y. Advance tax on persons remitting amounts abroad through credit or debit or prepaid cards.
(1) Every banking company shall collect advance tax, at the time of transfer of any sum remitted outside Pakistan, on behalf of
any person who has completed a credit card transaction, a debit card transaction, or a prepaid card transaction with a person
outside Pakistan at the rate specified in Division XXVII of Part IV of the First Schedule.
(2) The advance tax collected under this section shall be adjustable.
Adjustable/
Rate
Section Nature of Payment / Transaction Withholding Agent Final/
Minimum
Advance Tax on amount remitted abroad through credit, 1%
236Y Every Banking Company A
debit or prepaid card
EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (SECTION 236Y - ADVANCE TAX ON PERSONS REMITTING AMOUNTS ABROAD
THROUGH CREDIT OR DEBIT OR PREPAID CARDS)
Page 116 of 166
THE ELEVENTH SCHEDULE of The Sales Tax Act, 1990
1
THE ELEVENTH SCHEDULE
[see sub-section (7) of section 3]
Table
The rates for withholding or deduction by the withholding agent 2[are specified as below provided that
withholding of tax under this Schedule shall not be applicable to the goods and supplies specified vide clauses
(i) to (viii) after the Table]
S Withholding agent Supplier category Rate or extent of deduction

No.
(1) (2) (3) (4)
3 th
1. (a) Federal and provincial government [Active Taxpayers] 1/5 of Sales Tax as shown on
departments; autonomous bodies; and public invoice
sector organizations
(b) Companies as defined in the Income Tax
Ordinance, 2001 (XLIX of 2001)
4
2. (a) Federal and provincial government [Active Taxpayers] 1/10th of Sales Tax as shown on
departments; autonomous bodies; and public registered as a invoice
sector organizations wholesaler, dealer or
(b) Companies as defined in the Income Tax distributor
Ordinance, 2001 (XLIX of 2001)
5
3. Federal and provincial government [Persons other than Whole of the tax involved or as
departments; autonomous bodies; and public Active Taxpayers] applicable to supplies on the basis
sector organizations of gross value of supplies
6
4. Companies as defined in the Income Tax [Persons other than 5% of gross value of supplies
Ordinance, 2001 (XLIX of 2001) Active Taxpayers]
5. Registered persons as recipient of Person providing Whole of sales tax applicable
advertisement services advertisement services
7
6. Registered persons purchasing cane molasses [Persons other than Whole of sales tax applicable
Active Taxpayers]
8
7. Registered persons manufacturing lead Person supplying any 75% of the sales tax applicable
batteries kind of lead under
chapter 78 (PCT
Headings: 7801.1000,
7801.9100, 7801.9900,
7802.0000, 78.03,
7804.1100, 7804.1900,
7804.2000, 78.05,
7806.0010, 7806.0020,
7806.0090) or scrap
batteries under chapter
85 (PCT Headings:
8548.1010, 8548.1090)
1 Eleventh Schedule inserted by the Finance Act, 2019.

2 Words “shall not be applicable to goods and supplies specified after the end of this Table” substituted by Finance Act, 2020.
3 Words “Registered persons” substituted by Finance Act, 2020.
4 Word “Person” substituted by Finance Act, 2020.
5 Word “Un Registered Persons” substituted by Finance Act, 2020.
8 Serial # 7 inserted by Finance Act, 2021.
Page 117 of 166
1
8. Online market place Persons other than 2% of gross value of supplies:
active taxpayers Provided that the provisions of this
entry shall be effective from the
date as notified by the Board.
(i) Electrical energy;

(ii) Natural gas;
(iii) Petroleum products as supplied by petroleum production and exploration companies, oil refineries,
oil marketing companies and dealers of motor spirit and high speed diesel;
(iv) Vegetable ghee and cooking oil;
(v) Telecommunication services;
(vi) Goods specified in the Third Schedule to the Sales Tax Act, 1990;
(vii) Supplies made by importers who paid value addition tax on such goods at the time of import; and
(viii) Supplies made by an Active Taxpayer as defined in the Sales Tax Act, 1990 to another registered
persons with exception of advertisement services.
2
(ix) Supply of sand, stone, gravel/crush and clay to low cost housing schemes sponsored or approved by
Naya Pakistan Housing and Development Authority.
1 Serial # 8 inserted by Finance Act, 2021.

2 Clause (ix) inserted by Finance Act, 2020.
Page 118 of 166
1
Chapter XIV-D of The Sales Tax Rules, 2006
WITHHOLDING OF SALES TAX BY THE RECIPIENT OF SUPPLY
150ZZH. Application.
(1) This chapter shall apply to taxable goods and services as are supplied to the withholding agents as
specified in the Eleventh Schedule to the Act, for the purpose of deduction and deposit of sales tax.
persons registered as exporters.
(2) This chapter shall also apply to services on which federal excise duty is payable in sales tax mode,
and the ones specified in the Schedule to the Islamabad Capital Territory (Tax on Services)
Ordinance, 2001 (XLII of 2001).
(3) Withholding agent, in case of supplies to Federal or Provincial Government departments, includes
the accounting office which is responsible for making payment against the purchases made by a
government department.
150ZZI. Responsibility of a withholding agent.

(1) The withholding agent, intending to make purchases of taxable goods, shall indicate in an
advertisement or notice for this purpose that the sales tax to the extent as provided in this Chapter
shall be deducted from the payment to be made to the supplier.
(2) A withholding agent, other than a recipient of advertisement services, shall deduct an amount as
specified in the Eleventh Schedule to the Act and make payment of the balance amount to him as
per illustration given below,-
ILLUSTRATION (in case 1/5th of sales tax amount is to be deducted)

Value of taxable supplies excluding sales tax Rs. 1000
Sales tax chargeable @ 17% Rs. 170
Sales tax to be deducted by the withholding Agent Rs. 34 (i.e. Rs. 170 / 5)
Sales tax payable by the withholding agent to the supplier Rs. 136 (i.e. Rs. 170- Rs.34)
Balance amount payable to the supplier by the withholding agent Rs. 1136 (i.e. Rs. 1000 + Rs.136)
Provided that the withholding agent shall not be entitled to reclaim or deduct the amount of
tax withheld from such persons as input tax.
(3) A person who receives advertisement services, in case the sales tax amount is not indicated on the
invoice received, he shall deduct sales tax at the applicable rate of the value of taxable services from
the payment due to the service provider.
(4) Where the purchases are made by a government department, the following procedure shall be
observed, namely:--
(a) the Drawing and Disbursing Officer (DDO) preparing the bill for the accounting office shall
indicate the amount of sales tax withheld as illustrated above. The accounting office shall
adopt the procedure as indicated below:
(i) in case of purchases made by a department under the Federal Government, the office of
the Accountant General of Pakistan Revenue shall account for the amount deducted at
source during a month under the Head of Account "B02341-Sales Tax" and send an
intimation to the Chief Commissioner, Regional Tax Office, Islamabad, by the 15th of the
following month;
(ii) in case of purchases by departments under provincial or district governments, the

Accountant General of the province or the District Accounts Officer, as the case may be,
1 Chapter XIV-D inserted by SRO 698(I)/2019 dated June 29, 2019.

Page 119 of 166
shall credit the amount deducted at source during a month to the head of account
"GI2777-Sales Tax Deductions at Source under rule 40 & 40A of Chapter Miscellaneous of
Sales Tax (Withholding) Rules, 2007”. Cheque for the amount will be prepared by the
Accountant General or the District Accounts Officer, as the case may be, in the name of
Commissioner having jurisdiction by debit to the aforesaid head of account and sent to
the Commissioner by the 15th of the following month; and
(iii) where the purchases are made by the departments falling in purview of Military
Accountant General, the MAG shall account for the amount deducted at source during a
month under the Head of Account "B0234l-Sales Tax" and send intimation to the Chief
Commissioner, Regional Tax Office, Rawalpindi, by the 15th of the following month. The
amount so deducted at source shall be reported by MAG office to AGPR through civil
exchange accounts; and
(b) the concerned Drawing and Disbursement Officer shall prepare the return in the form as set
out in STR-28 for each month and forward the same to the Commissioner having jurisdiction
by the 15th of the following month.
(5) In case of purchases, not covered by sub-rule (4) or sub-rule (6), the sales tax deducted at source
shall be deposited by the withholding agent in the designated branch of National Bank of Pakistan
under relevant head of account on sales tax return-cum-payment challan by 15th of the month
following the month during which the purchase has been made. The return-cum-payment challan
shall be prepared and deposited with the bank in triplicate and the bank shall send the original to
the Commissioner of Sales Tax having jurisdiction, return the duplicate to the depositor and retain
the triplicate for its own record:
Provided that a single return-cum-challan can be filed in respect of all purchases for which the
payment has been made in a month.
(6) In case the withholding agent is also registered under the Sales Tax Act, 1990, or the Federal Excise
Act, 2005, he shall deposit the withheld amount of sales tax along with return filed for the month
in which the purchase was made in the manner as provided in Chapter II, along with other tax
liability:
Provided that in case the withholding agent is not registered for sales tax or federal excise
duty but holds a national tax number assigned under the Income Tax Ordinance, 2001 (XLIX of 2001),
he shall file the return, as set out in STR-28, electronically and deposit the amount deducted at
source in the manner as provided for persons filing returns electronically under rule 18:
Provided further that any other withholding agent may also opt to file the prescribed return
electronically and deposit the deducted amount in the manner as provided in this sub-rule.
(7) The withholding agent shall furnish to the Commissioner of Sales Tax having jurisdiction all such
information or data as may be requested by him for carrying out the purposes of these rules.
(8) A certificate showing deduction of sales tax shall be issued to the supplier by the withholding agent
duly specifying the name and registration number of supplier, description of goods and the amount
of sales tax deducted.
150ZZJ. Responsibility of the registered supplier.

(1) The registered supplier shall issue sales tax invoice as stipulated in section 23 of the Sales Tax Act,
1990, in respect of every taxable supply made to a withholding agent.
(2) The registered supplier shall file monthly return as prescribed in Chapter II, taking due credit of the
sales tax deducted by the withholding agent, in the manner as prescribed in the return.
Page 120 of 166

150ZZK. Responsibility of the Commissioner.
(1) The Commissioner shall keep a list of all withholding agents falling in his jurisdiction and monitor
payment of tax deducted by withholding agents falling in his jurisdiction and shall also ensure that
the return prescribed under these rules is filed.
(2) The Commissioner shall ensure that the return received from the bank is duly fed in the
computerized system as referred to in clause (5AA) of section 2 of the Sales Tax Act, 1990.
(3) The Commissioner shall periodically ensure that the suppliers mentioned in the return filed by the
withholding agents, as fall under his jurisdiction, are filing returns under Chapter II, and are duly
declaring the supplies made to withholding agents.
1
[]
1 Rule 150ZZL omitted by SRO 918(I)/2019 dated August 07, 2019. Earlier it was:
150ZZL. Exclusions.
(1) The provisions of this Chapter shall not apply to the supplies of the following goods and services if made by a registered
person, namely:-
(i) electrical energy;
(ii) natural gas;
(iii) petroleum products as supplied by petroleum production and exploration companies, oil refineries, oil marketing
companies and dealers of motor spirit and high speed diesel;
(iv) telecommunication services;
(v) goods specified in the Third Schedule to the Sales Tax Act, 1990 (VII of 1990), and the goods on which federal
excise duty is payable in sales tax mode on the basis of retail price;
(vi) supplies made by commercial importers who paid value addition tax on such goods at the time of import as
prescribed under Twelfth Schedule to the Act, and
(vii) Supplies made by an active taxpayer as defined in the Sales Tax Act, 1990 to another registered person with the
exception of advertisement services.
Page 121 of 166
SINDH SALES TAX SPECIAL PROCEDURE (WITHHOLDING) RULES, 2014
GOVERNMENT OF SINDH
Sindh Revenue Board
Karachi, dated 1st July, 2014.
NOTIFICATION
(Sindh Sales Tax on Services)
No. SRB-3-4/14/2014. In exercise of the powers conferred by section 13 of the Sindh Sales Tax on Services
Act, 2011 (Sindh Act No. XII of 2011), read with sub-section (4) of section 3, sub-section (3) of section 9, and
section 72 thereof, the Sindh Revenue Board, with the approval of the Government, is pleased to make the
following rules, namely:--
1. Short title, application and commencement.

(1) These rules may be called the Sindh Sales Tax Special Procedure (Withholding) Rules, 2014.
(2) They shall apply to taxable services as are provided or rendered to following persons, hereby specified
as "withholding agents", for the purposes of deduction and deposit of tax, namely:-
(a) offices and departments of Federal Government, Provincial Governments, and Local or
District Governments;
(b) autonomous bodies;
(c) public sector organizations, including public corporations, state-owned enterprises and
regulatory bodies and authorities;
(d) organizations which are funded, fully or partially, out of the budget grants of the federal or
provincial governments;
(e) companies, as defined in clause (28) of section 2 of the Act;

1
(f) [FBR-registered or SRB-registered persons or the persons specified in clauses (a), (b), (c),
(d) and (e) of sub-rule (2) of rule 1 of these Rules who receive or procure advertisement
services (tariff heading 98.02 and the sub-headings thereof, other than those of sub-
heading 9802.4000) or renting of immovable property services (tariff heading 9806.3000)
or services of auctioneers (tariff heading 9819.9100) or services of inter-city transportation
or carriage of goods by road (tariff heading 9836.0000, other than those through pipeline
or conduit 2[or through specialized car carriers or through the fleet of logistic companies
owning not less than 25 goods transport vehicles]), and also the persons providing or
rendering the services of advertising agents (tariff heading 9805.7000) who issue release
orders or book advertisement space in relation to advertisement services (tariff heading
98.02 and the sub-headings thereof): and]
3
[(g) SRB-registered persons receiving or procuring taxable service from un-registered persons;
1 Clause (f) substituted by notification # SRB-3-4/4/2015 dated July 01, 2015. Earlier it was:
(f) FBR-registered or SRB-registered persons receiving the services of advertisements; and
2 Words inserted by notification # SRB-3-4/18/2016 dated October 07, 2016.
3 Clause (g) substituted and clause (h), (i) & (j) inserted by Notification SRB-3-4/24/2019 dated July 01, 2019. Earlier it was:
(g) SRB-registered persons receiving taxable services from unregistered persons:
Provided that a person shall be treated as a withholding agent, for the purpose of these rules, only if he is resident in
Sindh or has a place of business in Sindh.
Page 122 of 166
(h) SRB-registered persons or insurers (tariff heading 9813A000 and the sub-heads thereof)
receiving or procuring the services provided or rendered by insurance agents or insurance
brokers (tariff heading 9855.0000);
(i) persons or passengers using the services of a cab aggregator (tariff heading 9846.0000)
required to deduct or withhold the tax in relation to the services provided or rendered by
the owners or drivers of the motor vehicles using the services of the cab aggregators (tariff
heading 9846.0000)
(j) persons receiving or procuring such of the services of contractors (tariff heading 9814.2000)
and construction (tariff heading 9824.0000) as are liable to reduced rate of tax at 2% or 5%
under notification No. SRB-3-4/9/2017 dated 2nd June, 2017 or are liable to reduced rate of
tax at 5% under notification SRB-3-4/3/2018 dated 6th February, 2018 and No. SRB-3-
4/8/2013 dated 1st July, 2013.]
(3) They shall come into force with effect from the first day of July, 2014.
2. Definitions.
(1) In these rules, unless there is anything repugnant in the subject or context,-
(1) "Act" means the Sindh Sales Tax on Services Act, 2011 (Sindh Act No. XII of 2011);
(2) "Advertisement" means the taxable services of advertisements classified under tariff heading
98.02 and the sub-heads and descriptions thereunder;
(3) "Board" or "SRB" means the Sindh Revenue Board established under the Sindh Revenue Board
Act, 2010 (Sindh Act No. XI of 2010);
(4) "FBR" means the Federal Board of Revenue established under the Federal Board of Revenue
Act, 2007;
(5) "FBR-registered person" means a person registered with FBR under the Sales Tax Act, 1990, for
the purpose of taxable supply of goods as defined in clause (41) of section 2 thereof and also
means a person holding NTN or taxpayers’ registration or FTN under the Income Tax
Ordinance, 2001 (Ordinance No. XLIX of 2001) or the rules or procedure made thereunder;
(6) "Form" means the form prescribed under these rules;
(7) "Rules" means the Sindh Sales Tax Special Procedure (Withholding) Rules, 2014;
(8) "SRB-registered person" means a person registered with SRB under the Sindh Sales Tax on
Services Act, 2011, for providing or rendering of taxable services as defined in clause (96) of
section 2 thereof;
(9) "Sales tax" or "Tax" means the Sindh sales tax on services as defined in clause (92) of section 2
of the Act;
(10) "Un-registered person" means a person who is liable to be registered under the Act but is
actually not registered and does not hold a Sindh sales tax registration number (SNTN); and
(11) "Withholding agent" means a person as specified in sub-rule (2) of rule 1 of these Rules
provided that he is resident in Sindh or has a place of business in Sindh1[;
Provided that in relation to the provisions of clause (i) of sub-rule (2) of rule 1 of these
rules, the cab aggregator resident in Pakistan and the branch office or resident representative
1 Proviso inserted by Notification SRB-3-4/24/2019 dated July 01, 2019.

Page 123 of 166
(in Pakistan) of the cab aggregator not resident in Pakistan shall be the withholding agent for
the purposes of these rules.]
Explanation.- The accounting offices responsible for or making payments against invoices/bills for the
taxable services received by an office or department of the Federal Government, Provincial
Governments or Local or District Governments shall be treated as a withholding agent for the purpose
of these rules.
3. Responsibility of a withholding agent.

(1) The withholding agent, intending to receive taxable services, shall indicate in a notice in Form SSTW-
05, that the sales tax, to the extent as prescribed in these rules, shall be deducted and withheld by
him from the payment made or to be made to the service provider and shall be deposited in Sindh
Government's head of account No. "B-02384" in the prescribed manner:
Provided that the withholding agent shall not be responsible to deduct or withhold such
amount of tax as are compulsorily collected against the invoices or bills issued by a SRB registered
service provider in respect of the services of telecommunication, banking company, financial
institution, 1[insurance company (other than a re-insurance company),] 2[in relation to its services of
life insurance and health insurance of individual persons] port operator, airport operator, terminal
operator, and airport ground services.
(2) A withholding agent who is not already registered with SRB as service provider shall electronically
apply for "Sign Up as Withholding Agent" with SRB on Form SSTW-01 upon which SRB shall issue him
a User ID, Password and PIN Code for Sindh sales tax withholding and payment purposes.
(3) A withholding agent, other than a person or a recipient of taxable services covered by clause (f) of
sub-rule (2) of rule 1, shall deduct an amount equal to one-fifth of the total amount of sales tax shown
in the sales tax invoice issued by a registered person and shall make payment of the balance amount
to service provider as per illustration given below,—
ILLUSTRATION: Value of taxable services Rs. 1000

excluding sales tax
Sales tax to be deducted by the withholding agent Rs. 26 (i.e. Rs. 130 / 5)
Sales tax payable by the withholding agent to the Rs. 104 (i.e. Rs. 130- Rs. 26)
service provider
Balance amount payable to the service provider by Rs. 1104 (i.e. Rs. 1000 +
the withholding agent. Rs. 104).
3
[Provided that where the invoice issued by the registered person does not indicate the
amount of sales tax, the withholding agent shall deduct and withhold the amount of sales tax, at the
rate applicable to the services provided or rendered to him, from the amount invoiced or billed or
charged by such registered person and, unless otherwise specified in the contract between the service
recipient and the service provider, the amount of sales tax for the purposes of this rule, shall be
worked out on the basis of gross value of the taxable services under the tax fraction formula. However,
this shall not absolve the registered service provider of his liability to the tax and the penalty and
default surcharge thereon, as payable under the Act or the rules made thereunder.]
1 Words inserted by Notification SRB-3-4/16/2014 dated October 01, 2014.

2 Words inserted by Notification SRB-3-4/18/2020 dated June 29, 2020.
3 Proviso inserted by notification # SRB-3-4/13/2017 dated June 05, 2017.
Page 124 of 166
(4) A withholding agent, having Free Tax Number (FTN) or National Tax Number (NTN) or Sindh sales tax
registration number (SNTN) and falling under sub-rule (2) of rule 1, shall, on receipt of taxable services
from unregistered persons, deduct the amount of sales tax, at the tax rate applicable to the taxable
services provided or rendered to him, from the amount invoiced or billed or demanded or charged by
such un-registered service provider and, unless otherwise specified in the contract between the
service recipient and the service provider, the amount of sales tax for the purpose of this rule, shall
be worked out on the basis of gross value of taxable services under the tax fraction formula:
Provided that in case a withholding agent receives taxable services from an un-registered
person, he shall be responsible to obtain and keep in record a copy of the CNIC of the unregistered
service provider if he is an individual and a copy of the NTN certificate of the unregistered service
provider if he is an AOP or a company. The withholding agent shall also be responsible to enter the
name, CNIC and NTN of the un-registered service, provider correctly in the relevant columns of the
return Form SST-03 or SSTW-03, as the case may be.
(5) A person mentioned in clause (f) of sub-rule (2) of rule 1, who receives the services of advertisement
, auctioneers, renting of immovable property and inter-city transportation or carriage of goods by
road 1[(other than the services of inter-city transportation and carriage of goods through truck addas
or through bus/wagon stands) as are] provided or rendered by a person registered with SRB or by a
non-resident person based in a country other than Pakistan, shall deduct the amount of sales tax as
mentioned in the invoice or the bill issued by the service provider, from the payment due to the
service provider. In case the sales tax amount is not indicated on the invoice, the recipient shall deduct
the amount of sales tax at the applicable rate of tax under the tax fraction formula from the payment
made or to be made to the service provider.
2
(5A) The withholding agents mentioned in clause (g) to clause (j) of sub-rule (2) of rule 1 of these rules shall
deduct and withhold the whole of the amount of Sindh sales tax on the services mentioned in the said
sub-clauses and shall deposit the same in Sindh Government head of account "B-02384" in the
prescribed manner.]
(6) Where the services are received by a withholding agent, as specified in clause (a) of sub-rule (2) of
rule 1 of these rules, the following procedure shall be observed, namely:-
(a) the Drawing and Disbursing Officer (DDO), preparing the bill for payment by the accounting
office, shall indicate the amount of sales tax to be withheld and deducted in terms of these
rules. The accounting office, responsible for making the payment, shall adopt the procedure
as indicated below:
(i) in case of services received by a Federal Government department or office, the office
of the Accountant General of Pakistan Revenue or the District Account Officer or the
Office responsible to make the payment shall deduct and withhold the tax amount
and shall transfer the amount, so deducted at source during a month, to Sindh
Government's head of account "B-02384---Sindh Sales Tax on Services". Intimation
about the withholding and such transfer of Sindh Sales Tax amount shall be sent by
the respective AGPR office to the Member (Taxation), SRB, Karachi, by the 15th day
of the following month;
(ii) in case of services received by departments or offices under the Sindh Government
or District or Local Governments thereof, the Accountant General of the Sindh or the
District Accounts Officer or the Office responsible to make the payment, as the case
may be, shall deduct and withhold the tax amount and credit the amount, so withheld
or deducted at source during a month, to Sindh Government's head of account "B-
02384---- Sindh Sales Tax on Services" and send an intimation about such withholding
1 Bracket and words inserted by Notification SRB-3-4/20/2019 dated June 27, 2019.
2 Sub-rule (5A) inserted by Notification SRB 3-4/24/2019 dated July 01, 2019.
Page 125 of 166
and transfer of tax amounts to the Member (Taxation), SRB, Karachi, by the 15th day
of the following month;
(iii) in case of services received by the departments and offices under a Provincial
Government, other than the Government of Sindh, or the Districts or Local
Governments in Sindh, the Accountant General of that Province or the respective
District Accounts Officer or the Office responsible to make the payment, as the case
may be, shall deduct and withhold the tax amount and shall credit the amount, so
deducted at source during a month, to Sindh Government's head of account "B-
02384----Sindh Sales Tax on Services". Cheque for the amount will be prepared by the
respective Accountant General or District Accounts Officer or the office responsible
to make the payment, as the case may be, in the name of the Member (Taxation),
SRB, Karachi, for debit to the aforesaid head of account and the same shall be sent to
the said Member (Taxation) by the 15th day of the following month; and
(iv) where the services are received by the departments or offices falling in purview of
Military Accountant General (MAG), the MAG shall deduct and withhold the amount
of tax and the amount, so deducted at source during a month, shall be transferred to
Sindh Government's head of account "B-02384----Sindh Sales Tax on Services". The
MAG shall send the intimation (of such deduction/withholding and its transfer to
Sindh Government's aforesaid head of account) to the Member (Taxation), SRB,
Karachi, by the 15th day of the following month. The amount, so deducted at source,
shall simultaneously be reported by MAG office to Accountant General Sindh through
civil exchange accounts; and
(b) the concerned Drawing and Disbursement Officer shall prepare the return in Form SSTW-03
for each month and file the same electronically on e.srb.gos.pk by the 18th day of the month
following the tax period to which it relates.
(7) In case of persons not covered by sub-rule (6) above, the withholding agent shall pay the withheld
amount of sales tax in the Sindh Government's head of account B-02384---Sindh Sales Tax on Services"
against a PSID/Challan prepared in Form SST-04, as prescribed in the Sindh Sales Tax on Services Rules,
2011, or in Form SSTW-04, as prescribed in these rules, by the following due dates: -
(i) in case the withholding agent is registered as a service provider under the Act, by the
prescribed due date of the month in which he claims input tax credit/adjustment in
Annex-A of his tax return (Form SST-03) or the date on which payment is made to the
service provider, whichever is earlier:
Provided that where such a withholding agent does not claim input tax credit
for a period of four months succeeding the month in which the tax invoice was issued
or is not otherwise entitled to claim input tax credit/adjustment, he shall deposit the
withheld amount of tax on the date on which he makes the payment to the service
provider or on a date within four months from the date of the invoice, whichever is
earlier; and
1
[]
1 Clause (ii) omitted by Notification # SRB-3-4/11/2016 dated June 28, 2016.

(ii) in case the withholding agent is not registered as a service provider under the Act but is registered with FBR under the Sales
Tax Act, 1990, by the 15th day of the month in which he claims input tax credit/adjustment in Annex-A of his tax return (Form
STR-7), as prescribed by the FBR, or the date on which payment is made to the service provider, whichever is earlier;
Provided that where such a withholding agent does not claim input tax credit/adjustment for a period of four months
succeeding the month in which the tax invoice was issued or is not otherwise entitled to claim input tax credit/adjustment, he
shall deposit the withheld amount of tax within a period of four months from the date of the tax invoice or the date when he
makes a payments to the service provider, whichever is earlier; and
Page 126 of 166
(iii) in case of other withholding agents, not covered by clause (i) of this sub-rule, by the
15th day of the following second month in which the tax invoice was issued by the
service provider or the date on which payment is made to the service provider,
whichever is earlier.
(8) In case the withholding agent is also a SRB-registered person under the Act, he shall file the return
and deposit the withheld amount of sales tax in the manner as provided under Chapter III of the Sindh
Sales Tax on Services Rules, 2011, alongwith his other tax liability, and such person shall not be
required to file the return SSTW-03, as prescribed under rule 6 these rules:
Provided that in case the withholding agent is not a SRB-registered person but holds a tax
registration number or NTN or FTN assigned under the Income Tax Ordinance, 2001 (XLIX of 2001), he
shall file the return, as set out in Form SSTW-03 of these rules, electronically, and deposit the withheld
or deducted amount of tax in Sindh Government's head of account "B-02384" against a withholding
challan prescribed in Form SSTW-04:
electronically and deposit the deducted amount in the manner as provided in this sub-rule.
(9) The withholding agent shall pay default surcharge, as prescribed in section 44 of the Act, in case of
any delay or default in payment of amount of tax withheld or deducted by him or liable to be withheld
or deducted by him and the said amount is not paid in Sindh Government's head of account "B-02384-
-- Sindh Sales Tax on Services" by the due date prescribed under these Rules.
(10) The withholding agent shall furnish to the Officer of the SRB all such information or data as may be
required by him for carrying out the purposes of these rules.
(11) A certificate, in the format set out in Form SSTW-06, showing deduction of sales tax, shall be issued
to the service provider by the withholding agent duly specifying the name and registration number of
service provider, description of services and the amount of sales tax deducted and withheld.
4. Responsibility of the registered service provider.

(1) The registered service provider shall issue tax invoice, as stipulated in section 26 of the Act, read with
sub-rule (1) of rule 29 of the Sindh Sales Tax on Services Rules, 2011, in respect of every taxable service
provided or rendered to a withholding agent.
(2) The registered service provider shall ensure that he allows withholding of tax to only such of his
service recipients as are withholding agents in terms of sub-rule (2) of rule 1 of these rules and also
that such service recipients have provided, to the service provider, the prescribed notice in Form
SSTW-05.
(3) The registered service provider shall file monthly return, as prescribed in the Sindh Sales Tax on
Services Rules, 2011, and shall adjust the admissible input tax against the output tax in terms of the
provisions of section 15 of the Act, taking due credit (in his tax return SST- 03) of the amount of sales
tax deducted by the withholding agent, in the manner as prescribed under Chapter III of the said Rules.
(4) Where service provider allows withholding of tax by a person who is not covered by the terminology
"Withholding agent" as defined in clause (11) of rule 2 of these rules, read with sub-rule (2) of rule 1
thereof, the service provider shall be liable to pay the tax involved alongwith the default surcharge
thereon.
Page 127 of 166

5. Application of other provisions.
1
[(1)] All the provisions of the rules and notifications made or issued under the Act, shall apply in relation
to the taxable services, the service providers and the service recipients or withholding agents covered
by these rules, to the extent that these are not inconsistent with the provisions of these rules.
2
(2) The withholding agent shall maintain the records as prescribed in section 26 of the Act and in sub-rule
(2A) of rule 29 of the Sindh Sales Tax on Services Rules, 2011, for a period of 8 years from the tax
period to which it relates. The withholding agent shall also maintain, for a period of 8 years from the
tax period to which it relates, the record of the tax invoices received by him from the service providers
and the documents and banking instruments showing the withholding agents' compliance of the
provisions of section 73 of the Sales Tax Act, 1990, and of clause (i) of rule 22A of the Sindh Sales Tax
on Services Rules, 2011.
6. Forms prescribed for withholding agents.

The forms, in Form SSTW-01 to Form SSTW-06, as annexed to these rules, are prescribed for the
purpose of these rules.
7. Repeal.
The Sindh Sales Tax Special Procedure (Withholding) Rules, 2011, issued under notification No. SRB-
3-4/1/2011, dated the 24th August, 2011, is hereby repealed.
(Tashfeen K. Niaz)
Member (taxation)
1 Existing provision numbered as sub-rule (1) by Notification SRB-3-4/18/2020 dated June 29, 2020.
2 Sub-rule (2) inserted by Notification SRB-3-4/18/2020 dated June 29, 2020.
Page 128 of 166
[File.No. SRB -3 -4/TP/1/2014]
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Punjab Sales Tax on Services (Withholding) Rules, 2015
GOVERNMENT OF PUNJAB
PUNJAB REVENUE AUTHORITY
20th February, 2015
NOTIFICATION
No. PRA/Orders.06/2012.-- In exercise of the powers conferred under section 76 of the Punjab Sales Tax on
Services Act 2012 (XLIII of 2012), Punjab Revenue Authority, with the approval of the Government, is pleased
to make the following rules:
1. Short title and commencement.

(1) These rules may be cited as the Punjab Sales Tax on Services (Withholding) Rules 2015.
(2) They shall come into force at once.
2. Definitions.
(1) In these rules:
(a) ‘’Act’’ means Punjab Sales Tax on Services Act 2012 (XLII of 2012);
(b) ‘’active taxpayer” means a registered person borne on the “active tax payers’ list” maintained
under rule 16 of the rules;
(c) “Form “ means a Form appended with the rules;
(d) “rules” means the Punjab Sales Tax on Services (Withholding) Rules 2015;
(e) “unregistered person” means a person who provides the taxable services to a resident of the
Punjab or is otherwise liable to be registered under the Act but has not been registered with the
Authority; and
(f) “Withholding agents” means:
(i) Federal Government, a Provincial Government, a local government, a department or

office under the Government, a public sector project or programme governed
thereunder;
(ii) autonomous body, special institution, public sector organization including public
corporation, Government-owned enterprise, regulatory or statutory body or authority;
(iii) organization which is funded, fully or partially, out of the budget grants of the Federal
Government or the Government;
(iv) recipient of services of an advertisement who is registered:
(a) for the sales tax, on good with the Federal Government; or
(b) for the sales tax on services in the Punjab;
(v) a Company which is resident or has a place of business in the Punjab;
(vi) registered persons receiving taxable services from other than registered persons; and
(vii) accounting office responsible for making payment against invoices or bills for the taxable
services received by an office or department of the Government, Federal Government,
provincial Governments or local governments.
(2) A word and expression used herein, but not defined in the rules shall have the meaning as are assigned
to them in the Act and rules made thereunder.
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3. Applicability.
(1) The rules shall not apply on services relating to telecommunication, banking, courier and insurance
and the services, except advertisement services, provided by the Companies being the active
taxpayers.
(2) Sub-rule (1) shall not be involved where insurance services are provided form outside the province to
a withholding agent in respect of a risk located in or relating to the province.

The withholding agent shall, for the purposes of acquiring and receiving taxable services, indicate
statement as follow in an advertisement, tender, notice, booking order or any other document made
or given for the purpose:
“Sales tax to the extent as provided in the rules shall be deducted and withheld from the
payment to be made to the service provider for depositing with Government of the Punjab.”
5. Withholding from registered service providers.

A withholding agent, other than a recipient of advertisement services, shall:
(a) withhold the whole amount of sales tax shown in the tax invoice, issued by a registered person
as service provider; and
(b) make payment of the balance amount of the invoice to registered person as service provider.
6. Withholding from unregistered person.

(1) A withholding agent shall, on receipt of taxable services other than advertisement services from an
unregistered person, deduct sales tax at the applicable rate of the value of taxable services provided
to him from the payment due to the service provider and the amount of sales tax for the purpose of
this rule shall be worked out on the basis of gross value of taxable services.
(2) If a withholding agent receives taxable services from an unregistered person, he shall be responsible
to obtain and keep in record:
(a) a copy of computerised national identity card of the unregistered person if he is an individual;
and
(b) a copy of national tax number of the unregistered person assigned under the Income Tax
Ordinance, 2011 (XLIX of 2001) if it is an association of persons or a Company.
(3) The withholding agent shall be required to enter correct information of computerised national
identity card or national tax number of the unregistered person, as the case may be, in the relevant
columns of the statement in Form ‘A’ or form PST -04 , whichever is applicable.
7. Deduction of tax on advertisement services.

(1) A withholding agent who receives advertisement services provided by a person based in Pakistan or
abroad shall deduct the whole amount of sales tax as mentioned in the invoice issued by the service
provider.
(2) In case where the amount of sales tax is not indicated on the invoice, the amount shall be deducted
by the withholding agent at the applicable rate on the gross value of taxable services from the
payment due to the service provider.
Explanation: “Advertisement” in the rules includes such taxable advertisements’ services as are
classified under the advertisements head 98.02 of the First Schedule of the Act read with all relevant
expressions and descriptions defined under the Punjab Sales tax on services (Definition) Rules 2012.
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8. Procedure.
(1) If taxable services are received by the Federal Government, the Government, any department or
office under the Governments including local and district departments, the following procedure shall
be observed:
(a) the Drawing and Disbursing Officer, preparing bill for the accounting officer, shall indicate the
amount of sales tax withheld under the rules and the accounting office shall adopt the
payment procedure as indicated below;
(i) in case of services received by a department or office under the Federal Government,
the office of the Accountant General of Pakistan shall account for and transfer the
amount deducted at source during a month to the Government through a cheque in
the name of the Chairperson of the Authority by credit to the relevant head of
account and send to the Authority by 15th day of the following month;
(ii) in case of services received by a department or an office under the Government; or a
local government, the account General of the Punjab or the District Accounts officer,
as the case may be, shall credit the amount deducted at source during a month to the
Government under due intimation to the chairperson of the Authority;
(iii) in case of services received by a department or an office under any provincial
government other than the Government; or districts or local governments thereof,
the Accountant General of that province or the respective District Accounts Officer
shall credit the amount deducted at source during a month to the Government
through a cheque in the name of the chairperson of the Authority to be sent by 15th
day of the following month to the Authority; and
(iv) if the services are received by a department or an office falling under the purview of
Military Accountant General, the Military Accountant General shall deposit the
amount deducted at source during a month with the Government under intimation
to the Chairperson of the Authority by 15th day of the following month and the
amount, so deducted at source, shall simultaneously be reported by Military
Accountant General to the Accountant General of the Punjab through civil exchange
accounts; and
(b) the concerned Drawing and Disbursement Officer shall prepare the statement as per Form ‘A’
for each month and forward the same to the Chairperson of the Authority by 15th day of the
following month.
(2) If taxable services are not covered under sub-rule (1), the withholding agent shall deposit the withheld
amount of sales tax with the Government on the form PST-04 as prescribed in the Punjab Sale Tax and
Services (Filing of Returns) Rules 2012 on the following due dates:
(a) in case the withholding agent is a registered person:
by the prescribed due date in the month following the tax period in which he claims
input tax adjustment in his Punjab sales tax return or the date on which payment is
made to the services provider on a date within four months from the date of the
invoice, whichever is earlier;
(b) in case the withholding agent is an unregistered person but is registered with the Federal
Board of Revenue under the Sale Tax Act, 1990 (VII of 1990):
(i) by 15th day of the month following the period in which he claims input tax adjustment
in the federal sale tax return as prescribed by the Federal Board of Revenue; or
(ii) by the date on which payment is made to the service provider or on a date within
four months from the date of the invoice, whichever is earlier; and
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(c) in case the withholding agents, is not covered under sub-clauses (a) and (b) : by 15th day of
the following second month in which the tax invoice was issued by the service provider or the
date on which payment is made to the service provider, whichever is earlier.
9. Filing of statement.
(1) If the withholding agent is a registered person, he or it shall file the standard return in the Form PST-
04 as prescribed in the Punjab Sales Tax and Service (Filing of Returns) Rules 2012 and deposit the
withheld amount of sales tax in the prescribed manner along with other tax liability, if any,
(2) A withholding agent shall not be required to file the statement on the Form ‘A’ if he or it falls under
sub-rule (1),
(3) in case the withholding agent is an unregistered person but holds a national tax number assigned
under the Income Tax Ordinance, 2001 (XLIX of 2001), he or it shall file a statement as on the Form
‘A’ and deposit the amount deducted at source in the prescribed manner.
(4) in case the withholding agent is neither registered person nor holds a national tax number assigned
under the Income Tax ordinance, 2001 (XLIX of 2001), he or it shall file a statement as on Form ‘A’ and
deposit the amount deducted at source in the prescribed manner.
(5) The return or the statement required to filed in pursuance of the rules may be filed either
electronically or manually through courier, post or otherwise.
(6) Where the withholding agent needs to revise the statement, resulting in payment of tax over the tax
already paid on the original statement, he or it may, without any permission from the Commissioner,
file his or its revise statement and pay the differential amount of tax along with the default surcharge
as applicable.
(7) The Commissioner shall be competent to allow revision of statement not covered under sub-rule (6)
and all such permissions for revision of statement shall be reported to the Authority on monthly basis
on the format showing the name, name of withholding agent, relevant tax period, revenue (including
adjustment) effect of revision and principal reasons of revision.
10. Provision of information or date.

(1) A withholding agent shall furnish to officer of the Authority, all such information or data as may be
required by him or it for carrying out the purposes of the Act and the rules made there under.
(2) Failure to furnish such information or data as required under sub-rule (1) shall render the withholding
agent liable to penal action under serial Nos. 5 and 11 of the Table of subsection (2) of section 48 of
the Act.
11. Certificate of withholding tax.

(1) A certificate on Form ‘B’ showing deduction of sale tax, may be issued to the service provider by the
withholding agent, the certificate shall:
(a) duly specifying the name and registration number of the service provider, if any;
(b) description and value of services;
(c) total amount of sales tax charged on the services; and
(c) total amount of tax deducted.
(2) A copy or copies of every or all such certificate or certificates, described in the sub-rule (1), shall be
sent to the Authority on monthly basis.
12. Responsibility of the registered person.

(1) A registered person shall;
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(a) issue a proper sales tax invoice in respect of every taxable services provided to a withholding
agent;
(b) file monthly return as prescribed in the relevant rules;
(c) subject to rule 13, be entitled to adjust input tax against the output tax taking due credit of
the sales tax deducted by the withholding agent or agents and deposited under the rules; and
(d) ensure that he or it allows withholding of sales tax to only such of his service recipients as are
withholding agents.
(2) If a registered person allows withholding of tax by a person who is not a withholding agent, the
registered person shall be liable to pay the tax along with the default surcharge payable on the tax.
(3) No recovery under sub-rule (2) shall be made unless the person concerned has been provided with an
opportunity of being heard but nothing in this rule, shall restrain or otherwise disable the officer of
the Authority or an authorised officer in this behalf to make recovery of tax in case of deliberate non-
appearance.
13. Deposit of withheld sales tax amounts.

(1) subject to sub-rule (2), all amounts of the sales tax on services deducted or withheld under the rules
shall be paid or deposited with the Government, under head of account “B-02385-Punjab Sales Tax
on services (withholding)” in the prescribed form and manner.
(2) Notwithstanding anything to the contrary contained in any other provision under the rules or any
other rules, no adjustment or credit shall be admissible to the persons registered under the Act in
case of the tax deducted or withheld and paid in respect of advertisement services.
14. Failure to pay tax withheld or deducted.

(1) A withholding agent shall be considered defaulter and personally liable to pay the amount of tax to
the Government, and an officer of the Authority may pass an order to that effect and proceed to
recover the same in the manner prescribed by Punjab Sales Tax on Services (Recovery) Rules 2012, If
a withholding agent under the rules:
(a) fails to withhold or deduct tax under the rules; or

(b) having withhold or deducted tax under the rules, fails to deposit the tax to the Government.
(2) If at the time of recovery of tax under sub-rule (1), it is established that the tax which was to be
deducted from the payment made to a person has meanwhile been paid, no recovery shall be made
from the person who had failed to withhold or deduct the tax but the said person shall be liable to
pay default surcharge at rates specified in section 49 of the Act form the date he failed to collect of
deduct the tax to the date the tax was paid.
(3) A person personally liable for an amount of tax under clause (a) of sub-rules (1) as a result of failing
to collect or deduct the tax shall be entitled to recover the tax from the person from whom the tax
should have been withheld or deducted.
(4) The provisions of the Act and the rules made thereunder shall apply to any amount required to be
paid to the Government under the rules as if it were tax payable under the Act.

(1) All the provisions of the rules made or notified under the Act shall apply to the taxable services
covered under the rules to the extent that these are not inconsistent with the provisions of the rules.
(2) The Authority may, constitute a three member committee headed by an officer not below the rank of
Commissioner, to consider cases of hardship or cases where there is significant risk to revenue, to give
its recommendations to the Authority to either conditionally or otherwise in circumstances of special
nature relax or specify the application of these rules in any case or class of cases.
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(3) The Authority may agree or otherwise dispense with the recommendations of the committee
constituted under sub-rule (2) of this rule in the manner deemed appropriate.
16. Active taxpayers’ list.

(1) For the purpose of implementing the rules, the Authority shall prepare an active taxpayers’ list.
(2) The active taxpayers’ list shall be regulated by such terms and conditions as may be specified and
declared by the Authority.
17. Repeal and Saving.

(1) The Punjab Sales Tax on Services (Withholding) Rules, 2012 are hereby repealed.
(2) The tax withheld or liable to be withheld or payable under the repealed rules shall be deemed to have
been withheld or liable to be withheld under these rules and shall be paid and dealt with accordingly.
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Form ‘A’
[see rule 6, 8 and 9]
Punjab Sales Tax Monthly Statement for Withholding Agents
Withholding Agent:
Name: _______________________________________________________________________________
____________________________________
Category: (mention the number of sub-clause_______ of clause (f) of sub-rule (1) of rule 2)
Status of Service Provider (Please  relevant option):
Registered / Unregistered
Contact (Tel / Cell): _______________ E-mail: _____________________
Period NTN/FTN
Sr. Name of NTN/ FTN/ or Description No. and Value Amount of Amount
No. Service CNIC of the date of Tax (excluding Punjab of Punjab
Provider whichever is services Invoices/ Sales Tax) of Sales Tax Sales Tax
applicable involved Commercial the Services Invoiced or Withheld
Invoices Involved or Involved
Gross Amount
of Commercial
Invoice
I, ___________________________________ holder of CNIC No. ______________________ in my
capacity as ___________________, certify that the information

given above is/are correct, complete and in accordance with the provisions of the Punjab Sales
Tax on Services Act, 2012 and the rules
and notification issued thereunder.

Verification
Date: ___________ Stamp: Signature: _________________
Head of Account “B – 02385 --- Punjab Sales Tax on Services (Withholding)”

Amount Received Rs. (in Figures) ________________ Rupees (in Words)
__________________________________________
Bank Officer’s Signature ______________________ Bank Stamp with Date ______________________
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Form ‘B’
[see rule 11]
Ref No. ______________________ Dated ____________________
CERTIFICATE OF DEDUCTION/WITHHOLDING OF THE PUNJAB SALES TAX ON SERVICES
I/ We __________________, PNTN _____________________, STRN _________________, located at

___________________________________________________________do hereby certify that:
We deducted/withheld the following amount of Punjab sales tax on services provided to us by M/S
_______________________________________ (PNTN/NTN) ______________________________ or
CNIC ____________________________________
Sr. Tax Tax Value of Amount Amount Tax period CPR NO. (“P-1” Remarks,
No. Invoice Invoice taxable of tax of tax of the Tax series) & date in if any
No Date services involved withheld/ return / which the deducted
deducted withholding /withheld tax
return in amount was
which this included in
tax was payment under
paid, by the Punjab’s Govt’s
services head of account “B-
recipient 02385”
(1) (2) (3) (4) (5) (6) (7) (8) (9)
This certificate is issued in pursuance of rule 11 of the Punjab Sales Tax on Services (Withholding) Rules,
2015.
Signature ______________________________
Name _________________________________
CNIC __________________________________
Designation ____________________________
Official seal ____________________________
Page 142 of 166

Khyber Pakhtunkhwa Sales Tax on Services (Withholding) Regulation, 2020
NOTIFICATION
Dated Peshawar, the August 13, 2020
No.F-16(4)KPRA/Notification/WH/1394-99. In exercise of the power conferred under section 114 of the

Khyber Pakhtunkhwa Finance Act, 2013 (XXI of 2013) read with clause (o) of subsection (2) of section 5,
subsections (2) and (3) of section 27, subsection (2) of section 30 and subsection (3) of section 34 and further
read with all relevant provisions thereof, the Khyber Pakhtunkhwa Revenue Authority is pleased to make
following regulation, namely. –

(1) This regulation may be called as Khyber Pakhtunkhwa Sales Tax on Services (Withholding) Regulation,
2020.
(2) It shall apply to the withholding agents receiving taxable services in, for or in respect of the province
of Khyber Pakhtunkhwa (for use, consumption, enjoyment or for any other purpose therein).
(3) It shall take effect on and from the first day of September 2020.
2. Definitions.
(1) In this regulation, the following words and terms shall have meanings assigned to them hereinafter:
(i) “Act” means the Khyber Pakhtunkhwa Finance Act, 2013 (XXI of 2013);
(ii) “Authority” means the Khyber Pakhtunkhwa Revenue Authority citable as KPRA or Authority
and includes its offices and officials while performing their official duties as employees of the
Authority.
(iii) “Government” means Government of Khyber Pakhtunkhwa;
(iv) “Head of Account” means the Head of Account under detailed object B-02386 Sales Tax on
services, Khyber Pakhtunkhwa wherein all the withheld tax amounts are to be deposited with
or transferred to the Provincial Consolidated Fund (Government);
(v) “Paragraph” means paragraph of this regulation and sub-paragraphs, clauses or items shall
be construed and referred to accordingly;
(vi) “Province” means the province of Khyber Pakhtunkhwa;
(vii) “Taxable service” means a service taxable under the Second Schedule of the Act and includes
the services which has been clarified of confirmed as taxable by the Authority through any
form of communication;
(viii) “Withholding” means an obligatory process involving;

--- retention of tax as per tax invoice or
--- deduction of tax leviable but not levied on non-tax or commercial invoice,
by a services recipient on or form the value of the “taxable services” paid, to be paid or
payable to the service provider and deposit thereof with the Government as aforesaid:
Page 143 of 166

provided that in case of non-tax or commercial invoice, tax amount shall be calculated
treating the value given in such invoice as exclusive of tax and the tax amount so calculated
shall be withheld from within the invoice value and paid to the Government accordingly;
Explanation: Under no circumstances, withholding shall be deemed or treated as reverse

charge where non-tax or commercial invoice value is or has been legally allowed to be treated
as value inclusive of deductible and payable tax; and
(ix) “Withholding agent” means withholding agent as specified in paragraph 3 of this regulation
regardless of the location of his or its head office or location of the business premises or
jurisdiction of his its registration or enrolment
Explanation: For the purpose of this definition, it is clarified that the expression “withholding
agents” shall include their respective accounting offices which are responsible for authorizing
payments against the taxable services received by them.
(2) The words and terms used but not defined in this regulation shall have the same meanings and
interpretations as are assigned to them under the Act and rules or regulations made thereunder so
far as they are applicable or relevant to this regulation.
3. Withholding agents and their responsibility.

(1) For the purposes of this regulation, all recipients of taxable services, falling in any of the following
categories shall be the withholding agents:
i. All Federal Government Departments and offices etc, who submit their bills (including payments
made in respect of projects) for pre-audit to the accountant General Pakistan Revenue (AGPR), its
Sub-offices and District Accounts Offices.
ii. The Departments and Offices of the Ministry of Defense who either submit this bills (including
bills in respect of projects) for pre-audit or compiled accounts of the Services Controllers and
Regional Controllers of the Military Accountant General.
iii. All others Federal government departments, i.e., Director Budget and Accounts (PAK PWD), Chief
Accounts Officer (Pakistan Railways), Director Accounts (Pakistan Post Office), Central Directorate
of National Savings who submit this monthly compiled accounts to AGPR.
iv. All Departments and Offices of the Government including District Government Departments who
submit their bills for pre-audit of the Accountant General Khyber Pakhtunkhwa or the District
Accounts Offices.
v. All Provincial Government Departments including District Government Departments who submit
their bills (including payments made in respect of projects) for pre-audit to the respective
Accountants General (AG) of the Province and District Accounts Offices.
vi. Environment Department of the Government who submits compiled accounts to the Accountant
General Khyber Pakhtunkhwa.
vii. All Divisional Engineers of the Departments of irrigation, Public Health Engineering and
Communication & Works including the Local and District Government Departments who submit
accounts on the prescribed form to the Accountant General Khyber Pakhtunkhwa.
viii. All public sector organizations, institute, corporations, universities, bodies, boards, Provincial,
District or Local Government including special purpose institutions, whether their official status,
character or position is pure government, semi-government, public, semi-public, autonomous,
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semi-autonomous, commercial, semi-commercial or non-commercial who are making such
payments directly at their own level through their internal accounting systems or offices.
ix. Companies as defined under sub-section (12) of section 2 of Act including those located in the
jurisdiction of or registered with any other tax authority for the purposes of payment of sales tax
in respect of goods or services rendered or provided in the province of Khyber Pakhtunkhwa.
x. Any other person specified, declared or confirmed by the Authority as withholding agent.
(2) The withholding agent, intending to purchase, acquire or receive taxable services in or for the
province, shall invariably indicate in the relevant advertisement, notices including prequalification or
tender notices, booking order or any other similar document, made or given in any mode or form, for
such purpose, that sales tax to the extent as provided in this regulation shall be deducted and withheld
from the payment to be made to the service provider and deposited in the Government Head of
Account No. B-02386 Sales Tax on services, Khyber Pakhtunkhwa.
Explanation: As and when need arises for the audit of the propriety of due payments of withholding
tax amounts by the government departments, public sector organizations or accounts offices etc
during any financial year, the Authority may, instead of conducting audit at its own level, require them
of their self-audit of such tax amounts and payment thereof and to furnish and audit report along
with a certificate to the Authority as to the propriety of the withholding tax amounts and payments
thereof and such audit shall be deemed to be an audit by the Authority provided that nothing shall
bar the Authority for any verification, investigation or re-audit on this account;
Provided that nothing shall restrict bar the Authority to conduct or cause to be conducted audit of
any withholding agent and all provisions of the Act and rules, regulations or other orders, instructions
or guidelines issued thereunder, relating to the audit and allied matters, of a registered person shall,
mutatis mutandis, apply on the audit of withholding agents.
4. Services not subject to withholding.

The telecommunication services (excluding such services as are provided or received by telecom
companies to or from each other) and such other services or class of services either with reference to
description, service provider or service recipient or call or classes thereof or otherwise, as may be
specified by the Authority conditionally or otherwise, shall not be liable to withholding
5. Compulsory application of full withholding.

The following services shall be compulsory liable to full withholding at applicable tax rates across the
board:
(i) Advertisement services of all descriptions, categories and types,
(ii) Services provided by persons either not registered with the Authority or if registered, are
inactive/non-active as per Active Taxpayers’ List of the Authority as available on its official
website,
(iii) Services provided or rendered to Federal or Provincial Government Departments or public

sector institutions, organizations, entities and projects etc regardless of the rate of tax on such
services,
(iv) Services provided in the province of Khyber Pakhtunkhwa by persons from outside the
province if such persons are not registered with the Authority, and
(v) Services liable to tax under the Act at reduced rate (less than the standard rate of 15%).
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Clarification: For the purpose of removal of any doubt, It is clarified that every person classified as
withholding agent under this regulation shall invariably withhold and deposit with the Government,
the whole amount of tax in respect of a service received by him in the province of Khyber
Pakhtunkhwa from a person registered in other provincial sales tax jurisdictions including Islamabad
Capital Territory but not registered with the Authority.
6. Extent of withholding in other cases.

(1) In all other cases not covered under paragraph 5. only fifty percent of the amount if leviable tax shall
be withheld by the withholding agent and deposited with the Government as provided under this
regulation.
7. Input tax adjustment under withholding regime.

(1) The persons who are registered with the Authority as regular taxpayer and are compliantly paying the
provincial sales tax on services at standard of 15% or at higher rate shall be entitled to take admissible
input tax adjustment in their monthly tax returns in case of services received by them form persons
other than unregistered or inactive registered persons subjected to full withholding under this
regulation.
(2) Under no circumstances, tax adjustment shall be admissible in case of withholding made on services
chargeable to reduced rate of tax or received from unregistered persons or inactive persons:
Clarification: Reduced rate of tax includes the fixed rate of tax or the tax paid or payable on
fixed basis.
8. Deposit time of withheld tax amounts.

(1) Where the withholding agent is registered exclusively with the Authority as a service provider under
Act, the withheld tax amount shall be deposited by the prescribed due date of the month in which he
claims input tax credit/adjustment against services received in Annex-A of his monthly sales tax return
or the date on which payment is made to the service provider, whichever is earlier:
Provided that where such a withholding agent does not claim input tax credit for a period of six
months succeeding the month in which the tax invoice was issue or is otherwise nit entitled to claim
input tax credit/adjustment for the reasons of non-availability of proof of payment, he shall deposit
the withheld or withholdable amount of tax on the date on which he makes the payment to the service
provider or by the last day of the said six months from the date of invoice, whichever is earlier.
(2) If a withholding agent is not registered with the Authority as a service provider under the Act but is
registered with FBR under the Sales Tax Act 1990, the withheld tax amount shall be deposited by the
prescribes due date of the month in which he claims input tax credit/adjustment in Annex-A of his
monthly sales tax return as prescribed by the FBR, or the date on which payment is made to the service
provider, whichever is earlier:
Provided that where such a withholding agent does not claim input tax credit/adjustment for a period
of six months succeeding the month in which the tax invoice was issued or is otherwise not entitled
to claim input tax credit /adjustment for the reasons of non-availability of proof of payment, he shall
deposit the withheld or withholdable amount of tax on the date on which he makes the payment to
the to the service provider or by the last day of the six months from the date of invoice, whichever is
earlier.
(2) If a withholding agent is not registered with Authority as a service provider under the Act but is
registered with FBR under the Sales Tax Act 1990, the withheld tax amount shall be deposited by the
prescribed due date of the month in which he claims input tax credit /adjustment in Annex-A of his
monthly sales tax return as prescribed by the FBR, or the date on which payment is made to the service
provider, whichever is earlier:
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Provided that where such a withholding agent does not claim input tax credit/adjustment for a period
of six months succeeding the month in which the tax invoice was issued or is not otherwise entitled
to claim input tax credit/adjustment for the reasons on non-availability of proof of payment. He shall
deposit the withheld amount of tax by the last day of the said six months from the date of the tax
invoice or the date when he makes a payment to the service provider, whichever is earlier.
(3) In case of other withholding agents, not covered by sub-paragraphs (1) and (2) above, the withheld
tax amount shall be deposited by the 15th day of the following month in which payment is made to
the service provider.
9. Registration of withholding agents of different categories.

(1) The persons who are already registered exclusively with the Authority as a regular tax payer in
capacity as a service provider, shall not be required to obtain any separate registration as withholding
agent. If not already done, they will only request the Authority through online means to make
necessary additional insertion application available in the Authority’s database.
(2) Subject to sub-paragraph (3), a person who is not already registered with the Authority as a regular
tax payer but is required to comply as withholding agent shall apply (for registration as withholding
agent) with the Authority upon which he shall be electronically allocated user identification, password
and personal identification number for the provincial sales tax withholding purpose and such person
may subsequently, if legally or otherwise legitimately required for any valid reasons, apply to the
Authority for deregistration as withholding agent and every such deregistration shall be subject to
due completion of the legal requirements, if any:
Provided that under no circumstances, the responsibility of any person as withholding agent shall be
effected or mitigated in the absence of registration or other system user-related particulars as
aforesaid and any amount of tax withheld by such person shall be deposited with the Government in
the manner prescribed in this regulation.
(3) The public sector withholding agents making tax payments through competent in house accounting
offices (self-accounting entities), shall obtain FTN from FBR (if not already obtained) and online apply
to the Authority for enrolment as withholding agent to get user ID. Password for the purposes of
payment of tax through PSID and CPR and for e-filing of the withholding statements to the Authority.
(4) The public sector withholding agents making payments through external accounting offices, shall
obtain FTN in terms of sub-paragraph (3) only for the purpose of e-filing of withholding statements
after enrolment with and after obtaining or issuance of password from the Authority.
(5) The provisions of section 43 read with all other relevant provisions of the Act shall mutatis mutandis
apply to the cases where withholding agent is required to be registered (including enrolled) has not
complied with the registration or other identical requirements under this regulation.
10. Procedure for accounting and deposit of withheld amount of sales tax on services under different
accounting systems of the federal and provincial Governments.
(1) The Drawing and disbursing Officers (DDOs), while preparing the bill for payment by the accounting
office, shall indicate the amount of sales tax to be withheld in terms of this regulation. The accounting
office, responsible for making the payment shall adopt the procedure as specified below:
(i) In case of acquisition of taxable services by the withholding agents falling in paragraph 3(1)(i),
the Accountant General Pakistan Revenue its Sub-offices or District Accounts Offices, while
making payment, shall deduct from the payable amount, the amount of provincial sales tax
and credit the amount so deducted during a calendar month to the Head of Account “G-12777
Sales Tax on Services deduction at source under Khyber Pakhtunkhwa sales Tax on Services
(Withholding) Regulation, 2020”. The amount so credited during a month shall be transferred
to Accountant General Khyber Pakhtunkhwa through civil exchange account in the following
Page 147 of 166

month for credit to the Head of Account B-02386 Sales Tax on Services Khyber Pakhtunkhwa
and intimation thereof shall be sent to KPRA by 15th of the following month.
(ii) In case of acquisition of taxable services by withholding agents falling in paragraph 3(1)(ii),
the Military Accountant General, the Service Controllers and regional Controllers, while
making payment, shall deduct from the payable amount, 12777 Sales Tax on Services
deduction at source under Khyber Pakhtunkhwa Sales Tax on Services (Withholding)
Regulation, 2020”. The amount so credited during a month shall be transferred to Accountant
General Khyber Pakhtunkhwa through civil exchange account in the following month for
credit to the Head of Account B-02386 Sales Tax on Services Khyber Pakhtunkhwa and
intimation to that effect shall be sent to KPRA by 15th of the following the month
(iii) In case of the withholding agents falling in paragraph 3(1)(iii), the respective chief Accounts
Officers/ Director Budget 7 Accounts shall credit the amount deducted by his office to the
Head of Account “G-12777 Sales Tax in Services deduction at source under Khyber
Pakhtunkhwa Sales Tax on Services (Withholding) Regulation, 2020”. The amount so credited
during a month shall be transferred to Accountant General Khyber Pakhtunkhwa through civil
exchange account in the following month for credit to the Head of Account B-02386 Sakes Tax
on Services Khyber Pakhtunkhwa and intimation on this account shall be sent to KPRA by 15th
of the following month.
(iv) In case of acquisition of taxable services by withholding agents falling in paragraph 3(1)(iv),
the Accountant General Khyber Pakhtunkhwa or the District Accounts Officers while making
payment, shall deduct from the payable amount the amount provincial sales tax and account
for the amount deducted at source during a month to the Head of Account “B-02386 Sales
Tax on Services Khyber Paktunkhwa” deduction at source under Khyber Pakhtunkhwa Sales
Tax on Services (Withholding) Regulation, 2020”. The Accountant General Khyber
Pakhtunkhwa shall send an intimation in this regard to the Authority by 15th of the following
month.
(v) In case of acquisition of taxable services by withholding agents falling in paragraph 3(1)(v),
the Accountant General of the respective province shall credit the amount deducted at source
under Khyber Pakhtunkhwa Sales Tax on Services (Withholding) Regulation, 2020”. The
amount so collected, deducted and credited during a month shall be transferred to
Accountant general Khyber Pakhtunkhwa through civil exchange account in the following
month for credit to the Head of Account B-02386 Sales Tax on Services Khyber Pakhtunkhwa
and send intimation on this account shall be sent to KPRA by 15th of the following month.
(vi) In case of acquisition of taxable services by withholding agent falling under paragraphs 3(1)(vi)
and 3(1)(vii), the concerned Drawing and Disturbing Officer, while making payment, shall
deduct from the payable amount, the amount of provincial sales tax and account for in the
monthly account. The amount so deducted shall be deposited to the Head of Account “B-
02386 Sales Tax on Services Khyber Pakhtunkhwa”.
(vii) In case of acquisition of taxable services by the withholding agents falling in paragraph
3(1)(viii), who are making payments directly at their own level through their own level through
their internal accounting systems, the concerned Drawing and Disturbing Officers shall be
responsible to deduct and deposit the amount of tax in time with Government through CPR
(after first generating PSID as per system-based process).
(2) Where under any emergency or exceptional circumstances, any accounting office finds it difficult or
impractical to make payment as aforesaid, it may deposit the tax through a cheque or cheques with
the authorized bank branch (National Bank of Pakistan) in the relevant head of account at its own
level under intimation to the Director General of the Authority or alternatively it may send such
Page 148 of 166

cheque wither to the withholding agent for direct deposit, or to the Director General of the Authority
for deposit purpose.
(3) Each of the accounting office or as the case may be, withholding agent referred to in sub-para (1) of
this paragraph, shall within fifteen days of the issuance of this regulation inform the Collector of the
Authority about the name, designation and official telephone number (beside mobile number, if
available) of its/his officer/official responsible or deputed to make deductions and deposit of
provincial sales tax amounts on its/his behalf so that the Collector of the Authority may maintain a
regular facilitative coordination with such officer/official for smooth compliance to this regulation.
(4) For each month, the concerned Drawing and Disbursing Officer of the withholding agent shall
electronically prepare and file a withholding statement by the 20th of the following month.
REITERATION NOTE: For the purpose of charity and emphasis, it is reiterated that the head of account
for the purpose of payment or deposit of Khyber Pakhtunkhwa sales tax on services with the
Government of Khyber Pakhtunkhwa is “detailed object B-02386 Sales Tax on Services , Khyber
Pakhtunkhwa” wherein all the withheld tax amounts are to be deposited with the Government as
prescribed under this regulation.
11. Monthly withholding statements by other withholding agents.

The withholding agents other than those covered under paragraph 10 or those who are registered
with the Authority as regular taxpayer shall, for each month, electronically prepare and file a
statement by 18th of the following month as specified and available on Authority’s official website and
in case no withholding transaction has taken place in any month, a nil statement shall be filed.
12. Conditions for withholding from unregistered services providers.

(1) Where any withholding agent procures taxable services from a person nit registered with the
Authority as a service provider, he shall, besides deducting leviable provincial sales tax, invariably
take:
--- a copy of the National Identity Card (CNIC) from an unregistered individual service provider, or
--- National Tax Number (NTN) issued under the Income Tax Ordinance, 2001 (XLIX of 2001) in case
the unregistered service provider is partnership or a company.
(2) The information about the NIC and NTN shall be provided to the Authority through the very next
statement, declaration, return filed under or in pursuance of or for the purpose of this regulation.
13. Issuance of withholding certificates.

On request by the service provider from whom tax withholding has been made, the withholding agent
shall issue a withholding certificate and one copy of every such certificate shall invariably be sent to
the deputy collector (Withholding) of the Authority:
Provided that if the service provider is not registered with the Authority, he shall be stated as
unregistered and where such service provider is not registered with the Authority but is registered
with other sales tax jurisdictions, the number of the registration and the name of the registering tax
authority shall be mentioned.
14. Adjudication for failure or default in tax withholding.

(1) Where any Withholding agent or as the case may be m Drawing & Disbursing Officer whether
registered as such or not, has failed to withhold the due tax payable to the Government or has
withheld such tax but has failed to timely deposit the tax so withheld, the officer of the Authority not
below the rank of Assistant Collector may issue show cause notice to such agent, adjudicate the case
and determine and recover the tax liability along with default surcharge and penalty in terms of the
relevant provisions of the Act rules and regulations made thereunder:
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Provided that where during the currency of the adjudication, it is reported, found or ascertained that
the tax amount covered in the show cause notice has been deposited with the Government, the
proceedings shall abate to the extent of the amount so deposited without prejudice to the liability,
full or part, on account of default surcharge or penalty as may be payable or otherwise determined
under the Act.
(2) For the purpose of this regulation the failure to file a monthly statement thereunder shall be treated
as failure to file a monthly return and shall be liable to penal action or penalty accordingly
15. Miscellaneous matters.

(1) The Drawing & Disbursing Officers of the public sector withholding agent shall be personally
responsible to ensure that all due and withholdable tax amounts are duly withheld and deposited or
caused to be deposited with Government as prescribed under this regulation and the required
statements are duty and timely filed with the Authority.
(2) The registered taxpayers (service providers) of the Authority who have provided taxable services to
the withholding agents and their tax has been withheld and deposited by such agents, shall be entitled
to avail admissible credit/adjustment of the tax, so deducted only on the basis of withholding
certificates issued to them by the concerned withholding agents.
(3) While the obligation of the registered taxpayers of the Authority for the Maintenance of records is
principally governed under section 48 of Act, the withholding agents shall similarly maintain all
relevant records and documents of all their withholding transactions including invoices, proofs of tax
payments, statements and withholding certificates etc for a period of five years.
(4) Every withholding agent shall be under legal obligation to cooperate with and provide free access to
the records and documents maintained or kept by him under this regulation to the authorized officer
of the Authority not below the rank of Assistant Collector, for the purpose of any verification,
inspection, audit or for any other official purpose and produce copies thereof as and if so required by
such officer.
(5) Where any difficulty arises in giving effect to any of the provisions of this regulation, the Director
General of Authority may direct such solution-oriented actions to be done as may be considered
appropriate, plausible and necessary to remove such difficulty.
(6) Where any special or exceptional circumstances so warrant, the Director General of Authority may,
for reasons to be recorded in writing, exempt any service provider or class of service providers from
the application of this regulation and allow the collection and payment of tax directly by the
concerned service provider or as the case may be, service providers.
(7) The provisions of the rules, regulations, notifications, general orders or notices or clarifications issued
under the Act, shall apply to the extent of matters and issues not specifically covered under this
regulation.
16. Repeal:
The Khyber Pakhtunkhwa Sales Tax on Services Special Procedure (Withholding) Regulation, 2015
shall stand repealed from the date coming into effect of this regulation.
-sd-
Director General
Khyber Pakhtunkhwa Revenue Authority
Distribution:
1. Secretary Finance Department, Government of Khyber Pakhtunkhwa.
2. PSO to the Finance Minister, Khyber Pakhtunkhwa.
Page 150 of 166

3. Director (Admin & HR) for publication of the Notification in the official gazette through
printing Corporation of Pakistan.
4. Deputy Director (Communications) for wide publicity in print and electronic media for
awareness of all concerned.
5. All Officers and Officials of KPRA.
6. Assistant Director (Web) with the request for uploading on KPRA’s official website.
7. Office copy.
Director (HR, Admin & Coord,)

Khyber Pakhtunkhwa Revenue Authority
Balochistan Sales Tax Special Procedure (Withholding) Rules, 2018
GOVERNMENT OF BALOCHISTAN
BALOCHISTAN REVENUE AUTHORITY
Quetta, the June 27, 2018
NOTIFICATION
No. BRA/BSTW/06/2018, Dated June 27, 2018. -- In exercise of the powers conferred by section 78 read
with section 14 of the Balochistan Sales Tax on Services Act, 2015 (Act No. VI of 2015), the Balochistan
Revenue Authority with the approval of the Government, is pleased to make the following rules, namely: -

(1) These rules may be called the Balochistan Sales Tax Special Procedure (Withholding) Rules, 2018.
(2) They shall apply to the taxable services that are provided or rendered to the following persons,
hereby specified as "withholding agents", for the purpose of deduction and deposit of tax, namely:
-
(a) offices and departments of Federal Government, Provincial Governments, Local or District
Governments, and a public-sector project or programme governed by such Governments;
(b) autonomous bodies;
(c) public sector organizations including public corporations, state-owned enterprises,
regulatory bodies and authorities;
(d) organizations which are funded, fully or partially, out of the budget grants of the Federal
Government or Provincial Governments;
(e) companies as defined in sub-rule (7) of rule 2 of these rules;
(f) FBR-registered persons or BRA-registered persons or the persons specified in clauses (a),
(b), (c), (d) and (e) of sub-rule (2) of rule 1 of these rules who receive or procure the services
of Advertisement (Tariff Heading 98.02), Intercity transportation or carriage of goods by
road (Tariff Heading 9804.1000); Advertising agent (Tariff Heading 9805.7000), Renting of
immovable property (Tariff Heading 9806.3000), Consultant (Tariff Heading 98.15) and
Auctioneer (Tariff Heading 9819.9000); and
(g) BRA-registered persons receiving taxable services from un-registered persons:
Provided that a person shall be treated as a withholding agent, for the purpose
of these rules, only if he is resident in Balochistan or has a place of business in Balochistan.
Page 151 of 166
Explanation: The accounting office responsible for making payments against
invoices / bills for the taxable services received by an office or department of the Federal
Government, Provincial Governments, Local or District Governments and public projects
shall also be treated as a withholding agent for the purpose of these rules.
(3) They shall extend to the whole Province of Balochistan.
(4) They shall come into force with effect from the first day of July, 2018.
2. Definitions.
In these rules, unless there is anything repugnant in the subject or context-
(1) "Act” means the Balochistan Sales Tax on Services Act, 2015 (Act No.VI of 2015);
(2) “Advertisement” means the taxable services of advertisements classified under tariff heading 98.02
and the sub-heads and descriptions thereunder;
(3) “Auctioneer” means a person providing or rendering the services in relation to auction of property,
whether movable or immovable and tangible or intangible, in any manner, classified under tariff
heading 9819.9000.
Explanation: Auction of property includes calling the auction or providing facility, advertising
or illustrative services, pre-auction price estimates, short term storage services, repairs and
restoration services in relation to auction of property;
(4) "Authority" or "BRA" means the Balochistan Revenue Authority established under the Balochistan
Revenue Authority Act, 2015 (Act No. VII of 2015);
(5) "BRA-registered person" means a person registered with BRA for providing or rendering of taxable
services;
(5) “Bank” means the National Bank of Pakistan or any of its branches designated, by notification in the
official Gazette, for the purpose of payment of tax;
(6) “Company” means-
(a) a company as defined in the Companies Act, 2017 (Act No. XIX of 2017);
(b) a banking company and foreign banking company as defined in the Banking Companies
Ordinance, 1962 (Ordinance No. LV1I of 1962), and includes anybody corporate which
transacts the business of banking in Pakistan;
(c) a non-banking finance company (NBFC) and the notified entities as specified in section 282A
of the Companies Ordinance, 1984 (Ordinance No. XLVII of 1984), read with the Non-Banking
Finance Company (Establishment and Regulation) Rules, 2003;
(d) a body corporate formed by or under any law in force in Pakistan;
(e) a modaraba company as defined in the Modaraba Companies and Modaraba (Floatation
and Control) Ordinance, 1980 (Ordinance No. XXXI of 1980);
(f) a financial institution as defined in the Financial Institutions (Recovery of Finances) Ordinance,
2001 (Ordinance No. XLV1 of 2001), including a microfinance institution licensed under the
Microfinance Institutions Ordinance, 2001 (Ordinance No. LV of 2001) and an Islamic financial
institution;
(g) a body incorporated by or under the law of a country outside Pakistan relating to
incorporation of companies;
(h) a trust, a co-operative society or a finance society or any other society established or
constituted by or under any law for the time being in force; or
(i) a foreign association, whether incorporated or not, which the Authority has, by general or
special order, declared to be a company for the purposes of the Act;
(7) “Computerized payment receipt” means a computer-generated receipt showing payment of tax to
the designated branch of the National Bank of Pakistan;
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(8) “FBR" means the Federal Board of Revenue established under the Federal Board of Revenue Act,
2007 (Act No. IV of 2007);
(9) "FBR-registered person" means a person registered with FBR under the Sales Tax Act, 1990, for the
purpose of taxable supply of goods as defined in sub-section (41) of section 2 thereof and also means
a person holding Balochistan Sales Tax Registration Number (BNTN), and NTN or FTN under the
Income Tax Ordinance, 2001 (Ordinance No. XLIX of 2001) or the rules or procedure made thereunder;
(10) "Form” means the forms prescribed under these rules;
(11) “Government dues” means recoverable amounts of sales tax, penalty, default surcharge or any other
amount of tax, duty or levy collectable under the Act or rules made thereunder and against the
recovery of which there is no bar or valid stay order from the competent court;
(12) “Person” means-

(a) an individual;
(b) a company, an agency or an association of persons incorporated, formed, organized or
established in Pakistan or elsewhere;
(c) the Federal Government;
(d) a Provincial Government;
(e) a Local Authority or Local Government in Pakistan; or
(f) a foreign Government, a political sub-division of a foreign Government, or a public
international organization.
Explanation: The use of the word “he” in the Act shall be taken to refer to any or all
of the persons mentioned in sub-clauses (a) to (f) above;
(13) “Recovery officer” means an officer of the Authority, authorized by the Commissioner for recovery
of Government dues;
(14) “Renting of immovable property” means and includes the renting, letting, sub-letting, leasing, sub-
leasing, licensing or similar other arrangements of immovable property for use in the course or
furtherance of business or commerce, but does not include-
(a) renting of immovable property by a religious body to another religious body;

(b) renting of vacant land or premises solely used for agriculture, aquaculture, farming,
forestry, animal husbandry or mining purposes;
(c) renting of land or premises solely used for outdoor games and sports;
(d) renting of buildings solely used for residential purposes or solely used as hostels and
boarding homes of a recognized educational institution; and
(e) renting of immovable property by hotels, motels, guest houses, clubs, marriage halls and
lawns which are otherwise liable to tax under tariff heading 98.01 and the sub-headings
thereof.
Explanation-I: Where renting of immovable property is effected under a single

composite contract or agreement involving part of property for use in commerce or business
and part of it for residential accommodation purpose, the entire property under the contract
or agreement shall be treated, for the purpose of levy of tax under the Act, as property for
use in commerce or business and, accordingly, the total value of the contract or agreement
shall be treated as taxable value;
Explanation-II: For the purpose of this clause-
(a) the term “for uses in the course or furtherance of business or commerce”
includes the use of immovable property as factories, offices including
Government offices or public offices, warehouses, laboratories, educational
institutions, shops, showrooms, retail outlets, multiple-use buildings, etc.;
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(b) the term “renting of immovable property” includes allowing or permitting
the use of land or space in an immovable property, irrespective of the
transfer of possession or control of the said property;
(c) the term “immovable property" includes-
(i) building and part of a building and the land or space appurtenant
thereto;
(ii) land or space incidental to the use of such building or part of a
building;
(iii) common or shared areas and facilities relating to the property
rented;
(iv) vacant land or space given on lease or license for construction or
temporary structure to be used at a later stage for furtherance of
business or commerce; or
(v) plant, machinery, equipment, furniture, fixture or fitting installed in
or provided in or attached to the immovable property; and
(d) the term “rent” means any payment or consideration, by whatever name
called, received or receivable under any lease, sub-lease, tenancy or any
other contract or agreement or arrangement for use, occupation or right to
use or occupy any immovable property, and includes any forfeited deposit
paid under such lease, sub-lease, tenancy or other contract or agreement or
arrangement;
(15) “Rule” means the Balochistan Sales Tax Special Procedure (Withholding) Rules, 2018;
(16) “Schedule” means the schedules appended to the Act;
(17) “Service” or “services” means anything which is not goods and shall include but not limited to the
services listed in the First Schedule to the Act.
Explanation-I: A service shall remain and continue to be treated as service regardless whether
or not the providing thereof involves any use, supply, disposition or consumption of any goods either
as an essential or as an incidental aspect of such providing of service;
Explanation-II: Unless otherwise specified by the Authority, the service or services involved in
the supply of goods shall remain and continue to be treated as service or services;
(18) “Service provider” means a person who is engaged in the provision or providing of service or
services in the course or furtherance of any economic activity;
(19) “Tax” means-
(a) the sales tax, additional tax or default surcharge levied under the Act;
(b) a penalty, fine or fee imposed or charged under the Act; and
(c) any other sum payable or recoverable under the provisions of the Act or the rules made
thereunder;
(20) ‘‘Taxpayer” means any person who, in the course of an economic activity, provides taxable services
for consideration and includes any person who is liable or is required to pay or is paying tax or any
sum under the Act or the rules made thereunder;
(21) “Taxable service” shall have the same meaning given to it under section 3 of the Act;
(22) “Transportation or carriage of goods” means the transportation or carriage of goods from one place
to another either by road or through pipeline or conduit, including the services of cargo handling like
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loading, unloading, packing, un-packing, stacking and storage of goods, classified under tariff heading
9804.1000;
(23) "Un-registered person" means a person who is liable to be registered under the Act but does not
hold a Balochistan Sales Tax Registration Number; and
(24) "Withholding agent" means a person as specified in sub-rule (2) of rule 1 of these rules.
Explanation: The words and expressions used but not defined in any provision of these rules,
shall have the same meaning as assigned to them under the Act and the Balochistan Sales Tax on
Services, Rules, 2018.

(1) The withholding agent, intending to receive taxable services, shall indicate in a notice in Form BSTW-
05, that the sales tax, to the extent as prescribed in these rules, shall be deducted and withheld by
him from the payment made or to be made to the service provider and shall be deposited / paid in
any designated branch of the National Bank of Pakistan in the Balochistan Government's head of
account "B-02387– Balochistan Sales Tax on Services" in the prescribed manner:
Provided that the withholding agent shall not deduct or withhold sales tax against the
invoices or bills issued by a BRA-registered service provider in respect of the services of
telecommunication, banking company, insurance company (other than a re-insurance company),
financial institution, port operator, airport operator, terminal operator, and airport ground services.
(2) A withholding agent who is not already registered with the Authority as service provider shall
electronically apply for "Sign-Up as Withholding Agent" to the Authority in Form BSTW-01 and the
Authority shall issue him a User ID, Password and PIN Code for Balochistan sales tax withholding and
payment purposes.
(3) A withholding agent, other than a recipient of the taxable services covered by clause (f) of sub-rule
(2) of rule 1 or a person receiving the taxable services from non-filers, shall deduct an amount equal
to one-fifth of the total amount of sales tax shown in the sales tax invoice issued by a registered person
and shall make payment of the balance amount to service provider as per illustration given below:
Illustration-
Value of taxable services excluding sales tax Rs. 1000
Sales tax to be deducted by the withholding agent Rs.30 (i.e. Rs.150/5)
Sales tax payable by the withholding agent to the

service provider Rs.120 (i.e. Rs.150 - Rs.30)
Balance amount payable to the service provider by

the withholding agent. Rs.1120 (i.e. Rs.1000 + Rs.120)
Provided that where the invoice issued by the registered person does not indicate the
amount of sales tax, the withholding agent shall deduct and withhold the amount of sales tax, at the
rate applicable to the services provided or rendered to him, from the amount invoiced or billed or
charged by such registered person and, unless otherwise specified in the contract between the service
recipient and the service provider, the amount of sales tax for the purposes of this rule, shall be
worked out on the basis of gross value of the taxable services under the tax fraction formula.
However, this shall not absolve the registered service provider of his liability to the sales tax and the
penalty or default surcharge thereon, as payable under the Act or the rules made thereunder.
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(4) A withholding agent, having Balochistan Sales Tax Registration Number (BNTN) and National Tax
Number (NTN) or Free Tax Number (FTN) and falling under sub-rule (2) of rule 1, shall, on receipt of
taxable services from un-registered person, deduct the amount of sales tax, at the tax rate applicable
to the taxable services provided or rendered to him, from the amount invoiced or billed or demanded
or charged by such un-registered service provider and, unless otherwise specified in the contract
between the service recipient and the service provider, the amount of sales tax for the purpose of this
rule, shall be worked out on the basis of gross value of taxable services under the following tax fraction
formula:-
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a
100 + a
(‘a’ is the rate of tax specified in Second Schedule to the Act):
Provided that in case a withholding agent receives taxable services from an un-registered
person, he shall be responsible to obtain and keep in record a copy of the CNIC of such un-registered
service provider if he is an individual and a copy of the NTN certificate if it is an AOP or a company.
The withholding agent shall also be responsible to enter the name, CNIC and NTN of the un-registered
service provider correctly in the relevant columns of the return Form BST-03 or BSTW-03, as the case
may be.
(5) The persons mentioned in clause (f) of sub-rule (2) of rule 1, receive or procure the services of
advertisement, intercity transportation or carriage of goods by road, advertising agent, renting of
immovable property, consultant and auctioneer as are provided or rendered by a person registered
with the Authority or by an un-registered person resident of Balochistan or by a non-resident person
based in a country other than Pakistan, shall deduct the amount of sales tax as mentioned in the
invoice or the bill issued by the service provider, from the payment due to the service provider. In
case the sales tax amount is not indicated on the invoice, the service recipient shall deduct the amount
of sales tax at the applicable rate of tax under the tax fraction formula, from the payment made or to
be made to the service provider.
(6) Where the services are received by a withholding agent, as specified in clause (a) of sub-rule (2) of
rule 1 of these rules, the following procedure shall be observed, namely: -
(a) the Drawing and Disbursing Officer (DDO), preparing the bill for payment by the accounting
office, shall indicate the amount of sales tax to be deducted and withheld in terms of these
rules. The accounting office, responsible for making the payment, shall adopt the procedure
as indicated below: -
(i) in case of services received by a Federal Government department or office, the office
of the Accountant General of Pakistan Revenue or the District Account Officer or the
Office responsible to make the payment shall deduct and withhold the tax amount
and shall transfer the tax amount, so deducted or withheld at source during a month,
to the Balochistan Government's head of account "B-02387-Balochistan Sales Tax on
Services". Intimation about the withholding and such transfer of Balochistan Sales
Tax amount shall be sent by the respective AGPR office to the Authority, by the 15th
day of the following month;
(ii) in case of services received by departments or offices under the Balochistan

Government or District or Local Governments thereof, the Accountant General of the
Balochistan or the District Accounts Officer or the Office responsible to make the
payment, as the case may be, shall deduct and withhold the tax amount and credit
the tax amount, so deducted or withheld at source during a month, to the Balochistan
Government's head of account "B-02387-Balochistan Sales Tax on Services" and
send an intimation about such withholding and transfer of tax amounts to the
Authority, by the 15th day of the following month;
(iii) in case of services received by the departments or offices under a Provincial

Government, other than the Government of Balochistan or the Districts or Local
Governments in Balochistan, the Accountant General of that Province or the
respective District Accounts Officer or the Office responsible to make the payment,
as the case may be, shall deduct and withhold the tax amount and shall credit the tax
amount, so deducted or withheld at source during a month, to the Balochistan
Government's head of account "B-02387-Balochistan Sales Tax on Services". Cheque
for the tax amount will be prepared by the respective Accountant General or District
Accounts Officer or the office responsible to make the payment, as the case may be,
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in the name of the Authority, for debit to the aforesaid head of account and the same
shall be sent to the Authority by the 15th day of the following month; and
(iv) Where the services are received by the departments or offices falling in purview of
Military Accountant General (MAG), the MAG shall deduct and withhold the amount
of tax and the tax amount, so deducted or withheld at source during a month, shall
be transferred to the Balochistan Government's head of account “B-02387-
Balochistan Sales Tax on Services". The MAG shall send intimation (of such
deduction/withholding and its transfer to Balochistan Government's aforesaid head
of account) to the Authority, by the 15th day of the following month. The tax amount,
so deducted or withheld at source, shall simultaneously be reported by MAG office
to the Accountant General Balochistan through civil exchange accounts; and
(b) the concerned Drawing and Disbursement Officer shall prepare the return in prescribed Form
BSTW-03 for each month and file the same electronically on https://bra.gob.pk, by the 18 th
day of the month following the tax period to which it relates.
(7) In case of persons not covered by sub-rule (6) above, the withholding agent shall pay the withheld
amount of sales tax in the Balochistan Government's head of account “B-02387-Balochistan Sales Tax
on Services” against a PSID/CPR/Challan prepared in Form BSTW-04, as prescribed in these rules, by
the following due dates: -
(a) in case the withholding agent is registered as a service provider under the Act, by the
prescribed due date of the month in which he claims input tax credit/adjustment in Annex-A
of his tax return (Form BST-03) or the date on which payment is made to the service provider,
whichever is earlier:
Provided that where such a withholding agent does not claim input tax credit for a
period of four months succeeding the month in which the tax invoice was issued or is not
otherwise entitled to claim input tax credit/adjustment, he shall deposit the withheld amount
of tax on the date on which he makes the payment to the service provider or on a date within
four months from the date of the invoice, whichever is earlier; and
(b) in case of withholding agents, not covered by clauses (a) of this sub-rule, by the 15th day of
the following month in which the tax invoice was issued by the service provider or the date
on which payment is made to the service provider, whichever is earlier.
(8) In case the withholding agent is a BRA-registered person, he shall file the return electronically and
deposit the withheld amount of sales tax in the manner as prescribed under Chapter-III of the
Balochistan Sales Tax on Services Rules, 2018 along with his other tax liability, and such person shall
not be required to file the return BSTW-03, as prescribed under rule 6 of these rules:
Provided that in case the withholding agent is not a BRA-registered person but holds a
National Tax Number (NTN) assigned under the Income Tax Ordinance, 2001 (XLIX of 2001), he shall
file the return, as set out in Form BSTW-03 of these rules, electronically, and deposit the deducted or
withheld amount of sales tax in the Balochistan Government's head of account "B-02387-Balochistan
Sales Tax on Services" " against a withholding challan prescribed in Form BSTW-04:
electronically and deposit the deducted or withheld amount of sales tax in the manner as provided in
this sub-rule.
(9) The withholding agent shall pay default surcharge, as prescribed in section 49 of the Act, in case of
any delay or default in the payment of sales tax so deducted or withheld by him or liable to be
deducted or withheld by him, in the Balochistan Government's head of account "B-02387-Balochistan
Sales Tax on Services" by the due date prescribed under these rules.
Page 158 of 166

(10) The withholding agent shall furnish to the officer of the Authority such information or data as may
be required by him for carrying out the purposes of these rules.
(11) A certificate, in the format set out in Form BSTW-06, showing deduction of sales tax, shall be issued
to the service provider by the withholding agent duly specifying the name and registration number of
service provider, description of services, invoice number and date of invoice and the amount of sales
tax deducted and withheld.
(12) The authority may de-register a registered withholding agent not required to be registered under
the Act in the manner as prescribed: -
(a) The withholding agent who ceases to provide taxable service or is no more required to be
registered, shall apply to the Authority, through an application on prescribed Form BSTW-02.
The Authority after causing such inquiries or audit by an officer of the Authority as deemed
appropriate, shall de-register such withholding agent from such date as may be specified,
subject to payment of all dues outstanding against such withholding agent. All orders for de-
registration, passed under this rule, shall be placed on BRA’s website and shall also be
communicated to PRAL within three days from the date of such order; and
(b) The application for de-registration shall be disposed of within a period of ninety days from
the date of receipt of application, or within such extended period, not exceeding sixty days,
as the Authority may, for reasons to be recorded in writing, fix.
4. Responsibility of registered service provider.

(1) The registered service provider shall issue tax invoice, as specified in section 30 of the Act, in respect
of every taxable service provided or rendered to a withholding agent.
(2) The registered service provider shall ensure that he allows withholding of sales tax to only such of his
service recipients as are withholding agents in terms of sub-rule (2) of rule 1 of these rules and also
that such service recipients have provided, to the service provider, the prescribed notice in Form
BSTW-05.
(3) The registered service provider shall file monthly return, as prescribed in the Balochistan Sales Tax on
Services Rules, 2018 and shall adjust the admissible input tax against the output tax in terms of the
provisions of section 16 of the Act, taking due credit, in his return, of the amount of sales tax deducted
by the withholding agent, in the manner as prescribed in Chapter-III under the Balochistan Sales Tax
on Services Rules, 2018.
(4) Where the service provider allows withholding of sales tax by a person who is not covered by the
definition of "Withholding agent" under these rules, the service provider shall be liable to pay the
sales tax involved along with the default surcharge thereon.

All the provisions of the rules and notifications made or issued under the Act, shall apply in relation
to the taxable services, the service providers and the service recipients or withholding agents covered
by these rules, to the extent that these are not inconsistent with the provisions of these rules.
6. Forms prescribed for withholding agents.

The forms, in Form BSTW-01 to Form BSTW-06, as annexed to these rules, are prescribed for the
purpose of these rules.
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PREFACE

 Sections of Income Tax Ordinance, 2001 relevant to Withholding / Advance Tax.

Updated: Finance Act, 2021.

Rule 43B - Amount actually paid under section 158

Rule 43 - Payment of tax collected or deducted

(i) by remittance to the Government Treasury or deposit in an authorized branch of the

Rule 42 - Certificate of collection or deduction of tax

Rule 44 - Statement of tax collected or deducted

1 Proviso inserted by Finance Act, 2021.

1 Figure inserted by Finance Act, 2017.

Rule 40 - Exemption or lower rate certificate u/s 159

1 Words “section 100C” inserted by Finance Act, 2021.

Provisions relating to persons not appearing in active

Section 100BA - Special provisions relating to persons not appearing in active

THE TENTH SCHEDULE

2. Persons not required to file return or statement.

1 Words inserted by Finance Act, 2020.

4. Finalization or abatement of provisional assessment.

6. For the purposes of this Schedule, imputed income means—

9. Provisions of Ordinance to apply.

List of Sections on which 10th Schedule is applicable

1 Expression “(1), (1AA), (2)” substituted by Finance Act, 2020.

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 100BA, 10th Schedule)

1 Words inserted by Finance Act, 2020.

1 Part II of First Schedule substituted by Finance Act, 2020. Earlier it was:

Provided that the rate specified in column (3),

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 148 - Imports)

1 Words “30th day of September, 2020” substituted by Finance Act, 2021.

1 Figure “2020” substituted by Finance Act, 2020.

(ii) Seeding or planting equipment

(iii) Irrigation, drainage and agro-chemical application equipment

1 Clause (24C) inserted by Finance Act, 2019.

(iv) Harvesting, threshing and storage equipment

(v) Post-harvest handling and processing & miscellaneous machinery

1 Section 148A omitted by Finance Act, 2020. Earlier it was:

(4) Tax deducted under sub-section (3) shall be adjustable.

WITHHOLDING TAX RATES

1 Substituted for “employer” by Finance Act, 2013.

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 149 - Salary)

1 Clause (109A) inserted by Finance Act, 2019.

Section 150 - Dividends

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 150 - DIVIDENDS)

1 Words inserted by Finance Act, 2021.

1 Clause (109A) inserted by Finance Act, 2019.

1 Section 150A omitted by Finance Act, 2021. Shifted to Section 151.

S. No Profit on Debt Rate of tax

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 7B – TAX ON PROFIT ON DEBT)

1 Word “thirty six” substituted by Finance Act, 2021.

1 Sub-section (1A) inserted by Finance Act, 2021.

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151 - PROFIT ON DEBT)

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(b) - PROFIT ON DEBT)

1 Clause (109A) inserted by Finance Act, 2019.

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(c) - PROFIT ON DEBT)

EXEMPTIONS, RATE REDUCTION AND CLARIFICATIONS (Section 151(1)(d) - PROFIT ON DEBT)

Section 6 - Tax on certain payments to non-residents

(3) This section shall not apply to –

1 Words inserted by Finance Act, 2018.

1 Sub-section (1AAA) inserted by Finance Act, 2012.

1 Sub-section (1DA) and (1DB) inserted by Finance Act, 2021.