Pakistan's FBR imposes Rs 5 per unit electricity tax on steel makers

The Federal Board of Revenue (FBR) has notified 99 registered iron and steel manufacturers in Pakistan that they must pay a sales tax of Rs 5 for each unit of electricity consumed. The tax will be collected automatically through the manufacturers' monthly electricity bills, as stipulated in SRO 1245(I)/2026 issued on July 31 2026 under the Sales Tax Act, 1990.

Eligibility is based on the firms' import of more than 70 % of their scrap requirements in the previous 12 months, using specified Harmonized System codes and purchases from exporters under the Export Facilitation Scheme. The list of notified manufacturers is not permanent; the FBR or the relevant Commissioner Inland Revenue may add or remove firms after review. Manufacturers facing difficulties can apply for relief. The measure aims to improve tax compliance, increase transparency and boost revenue from Pakistan’s iron and steel sector.