FBR Withdraws Fixed Sales tax on SIM Cards

The Federal Revenue Board (FBR) withdrew from 1 July 2021 the fixed sales tax on mobile phone SIM cards.

The FBR issued Circular of sales tax number 2 to 2021, which states that, under Table-I of the 9th Schedule to the Sales Tax Act, the subscriber identification card (SIM) tax charged by SIM cards at rs. 250 was withdrawn.

The FBR said that the online marketplaces supporting the delivery of products belonging to third-party suppliers must withhold sales tax at the rate of 2% of the gross value of supplies of people other than active taxpayers.

Following the Export Facilitation Scheme, 2021, the zero sales tax on the local supply of raw materials, components, parts and machinery to registered exporters has been allowed. According to the FBR, the zero-rated regime includes milk and fat-filled milk.

In addition, border sustainability markets have been set up along the Iran and Afghanistan borders to alleviate the problems encountered by the fence and counter-contributing efforts by residents of the borders of Balochistan and Khybers Pakhtunkhwa. The insertion of new Table-4 into the Sixth Schedule to the STA was given an exception to support these markets for certain items specified.

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Federal excise exemption for some items intended for these markets was also granted.

POS devices imported for installation in retail outlets linked with the Board's computer system have been given sales tax exemption to ease and encourage the integration of tier-1 retailers.

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