ISLAMBAD: The Federal Board of Revenue (FBR) has introduced significant changes to sales tax rules governing Pakistan’s steel sector, shortening the verification period for scrap utilisation and revising provisions related to the industry.
The amendments will take effect on October 1, 2026, and include changes to verification timelines, references to registered persons and the process for integration with the FBR’s computerised system.
Under the revised sales tax regulations, the timeframe for verifying the use of imported scrap and scrap obtained under the Export Facilitation Scheme (EFS) has been reduced from 12 months to six months.
The change applies to steel melters, re-rollers and composite units covered by the amended rules. Steel factories will now have a shorter period? for verification of the required utilisation.
The revised timeframe focuses on verifying compliance with the requirement that 70% of the imported and EFS scrap be utilised.
Computerised system integration date
The FBR will announce the date for integration with its computerised system through a Sales Tax General Order (STGO). The announcement will provide further details regarding the integration process under the revised regulatory framework.
The amendments also remove references to “registered persons” from the notification concerning the steel sector.
The changes form part of the FBR’s broader revision of sales tax regulations applicable to steel melters, re-rollers and composite units.
New rules to take effect on Oct 1
The FBR’s amendments to the steel sector’s sales tax regulations are scheduled to come into force on October 1, 2026.
The revised rules introduce a shorter verification window for the 70% scrap utilisation requirement, while the date for computerised system integration will be communicated separately through a Sales Tax General Order.
