ISLAMABAD: The Federal Board of Revenue has introduced a new Sales Tax General Order, imposing a sales tax of Rs5 per unit of electricity on selected steel companies.
According to the FBR, the measure aims to strengthen tax compliance, improve documentation and enhance revenue collection in Pakistan’s steel industry.
Under the new mechanism, selected steel melters, rerollers and composite units will pay an additional Rs5 sales tax on every unit of electricity consumed.
Moreover, the relevant power distribution companies will collect the tax through electricity bills issued to the affected businesses. The FBR said this approach will streamline tax collection by linking the levy with electricity consumption.
The new tax will apply only to companies meeting the criteria specified in the Sales Tax General Order. In particular, the levy targets firms that satisfy prescribed conditions related to scrap imports.
Furthermore, the FBR has issued a notified list of companies covered under the new taxation mechanism. Only businesses included in that list will be required to pay the additional sales tax through their electricity bills.
According to the board, the Sales Tax General Order will take effect under the notification issued on August 4, 2026.
The FBR said the initiative seeks to improve transparency, strengthen enforcement and increase the efficiency of tax administration in the steel sector while expanding documentation across the industry.
