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.
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.