ISLAMABAD: The Federal Board of Revenue (FBR) has categorically ruled that the seeds including rice seeds are not exempted from sales tax after passage of Finance (Supplementary) Act, 2022.
Thus, sales tax is applicable on seeds including rice seeds.
According to a legal clarification issued by the FBR to the chairman Standing Committee Defence Production, National Assembly, sales tax exemption is only available to rice, wheat and meslin.
The FBR has been requested to issue clarification as to whether “rice seed” is exempt under Serial Number-19 of Table-1 of the Sixth Schedule to the Sales Tax Act, 1990.
In this regard it is apprised that Sr No. 19 of Table-1 of the Sixth Schedule to the Sales Tax Act, 1990 has been substituted through the Finance (Supplementary) Act, 2022 and resultantly, rice seed, like other seeds, is no more exempt from sales tax.
Currently only rice, wheat and meslin flour are exempt from sales tax.
In view of the above it is stated that rice seed, falling under Pakistan Customs Tariff (PCT) Heading 1006.1010, is not exempt from sales tax under serial number 19 of Table-1 of the Sixth Schedule to the Sales Tax Act, 1990, the FBR added.
