Rice Seeds Not Exempt from 17% Sales Tax: FBR Clarifies to NA Committee

FBR has clarified to the National Assembly Standing Committee of Defence Production that rice seeds are not exempt from 17 percent sales tax. The exemption was removed after the introduction of Supplementary Finance Bill 2022 on 16 January 2022.

The Federal Board of Revenue (FBR) had imposed a standard rate of 17 percent sales tax on all kinds of seeds, including rice, on 16 January 2022.

Previously, The FBR has been directed by the Chairman Committee, Chaudhary Iftikhar Nazir, to clarify whether rice seed is exempt from sales tax under Sr. No. 19 of Table 1 of the Sixth Schedule to the Sales Tax Act, 1990.

The clarification received at the Parliament House revealed that rice seed had been removed from sales tax exemptions after the passage of the Finance (Supplementary) Act, 2022.
Apropos, it was 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. Resultantly, rice seed, like other seeds, is no longer exempt from sales tax.

In light of these details and under Pakistan Customs Tariff (PCT) Heading Number 1006.1010, the rice seed is not exempt from sales tax under Serial Number 19 of Table-1 of the Sixth Schedule to the Sales Tax Act, 1990, as per the FBR’s clarification.

Faiz Paracha is a seasoned broadcast journalist with over 15 years’ experience in reporting and e...



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