ISLAMABAD: The Federal Board of Revenue (FBR) has proposed expanding the sales tax net to cover 21 additional categories of retail packaged products, a move that could bring hundreds of consumer goods under stricter tax documentation and collection requirements.
The proposal came under discussion during a meeting of the National Assembly Standing Committee on Finance on Thursday as lawmakers reviewed the Finance Bill 2026.
FBR officials informed the committee that locally manufactured products included in the proposed categories would be required to display printed retail prices at the manufacturing stage. The measure aims to reduce tax evasion by ensuring that businesses charging full retail prices also pay the applicable sales tax.
According to tax authorities, the proposed mechanism would apply only to products sold in retail packaging. The FBR noted that importers covered under the scheme would be exempt from the additional 4 percent sales tax currently imposed on sales made to unregistered persons.
If approved, the proposal could affect a wide range of consumer goods, including packaged food items, beverages, cosmetics, household products, insecticides, and other retail-packaged commodities.
During the meeting, Standing Committee Chairman Naveed Qamar expressed concern that agricultural sprays should not be unintentionally included in the new taxation framework, emphasizing the need to protect the agriculture sector from unintended tax burdens.
The committee directed the FBR to provide detailed revenue projections and a comprehensive impact assessment before any final decision is taken on the proposal.
The move is part of the government’s broader efforts to expand the tax base, improve documentation of the economy, and enhance sales tax compliance across the retail sector under the Finance Bill 2026.
