Author: Shahnawaz Akhter

Importers in Pakistan often pay excess sales tax at the clearance stage due to errors, incorrect valuation, or subsequent relief granted by appellate authorities. To address this, the Sales Tax Rules, 2006 (updated for Tax Year 2026) provide a clear mechanism for claiming import-related sales tax refunds under Rule 34A.

The Sales Tax Rules, 2006, as updated for Tax Year 2026, clearly define the eligibility, scope, and procedure for claiming sales tax refunds on zero-rated supplies and non-zero-rated (taxable) supplies under Rule 33 and Rule 34. Understanding the distinction is critical to avoid claim rejections and audit issues.

The Federal Board of Revenue (FBR) has streamlined the processing of sales tax refund claims through the STARR (Sales Tax Automated Refund Repository) channel under Rule 30 and Rule 31 of the Sales Tax Rules, 2006, as updated for Tax Year 2026. This digital mechanism aims to enhance transparency, reduce delays, and ensure faster disbursement of legitimate refunds.

Islamabad, January 13, 2026 – The Federal Board of Revenue (FBR) has released key highlights of its revenue collection performance for the fiscal year 2024-25, reporting a strong growth across direct taxes, sales tax, customs, and federal excise duties.

The Risk Management System (RMS) of the Federal Board of Revenue (FBR) plays a central role in ensuring transparent, automated, and risk-based processing of sales tax refund claims in Pakistan. For tax year 2026, refund claims are no longer processed manually; instead, they are evaluated through FBR’s computerized RMS under Rule 29 of the Sales Tax Rules, 2006.

Filing a sales tax refund claim with the Federal Board of Revenue (FBR) requires accuracy, proper timing, and compliance with prescribed rules. Any mistake can delay processing or result in rejection. To streamline refunds, Rule 28 of the Sales Tax Rules, 2006 (updated for tax year 2026) lays down a simplified and automated mechanism.

Returned or cancelled supplies are a common part of business operations. However, incorrect adjustment of input and output tax can lead to penalties and audit issues. To address this, Rule 22 of the Sales Tax Rules, 2006 (updated for tax year 2026) provides a complete framework for handling tax adjustments through debit and credit notes.

The Federal Board of Revenue (FBR) has reiterated strict documentation and approval requirements for cancellation or return of taxable supplies under Rule 20 of the Sales Tax Rules, 2006, updated for Tax Year 2026.