The Federal Board of Revenue (FBR) has mandated a broad range of service providers to integrate their sales tax operations with its computerized system for real-time reporting of services, starting from July 1, 2025.
This requirement is outlined in the updated Islamabad Capital Territory (Tax on Services) Ordinance, 2001, as amended by the Finance Act 2025.
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According to the revised law, service providers listed in Table 1 and Table 2 of the Ordinance’s Schedule will be required to connect their systems with the FBR’s digital platform in a manner and timeline to be specified through a general order issued by the Board.
Table 1 includes 60 categories of services such as those offered by hotels, motels, guest houses, farmhouses, marriage halls, lawns, clubs, and caterers. It also covers courier and road cargo services provided by courier companies, as well as construction and other specified services under the Ordinance.
Table 2 contains additional service categories, expanding the scope of this integration requirement.
Furthermore, the Ordinance grants FBR the authority to issue a Negative List—a list of exempt services—by official notification in the Gazette. This list, detailed in Table 3, will outline services excluded from tax obligations under specific conditions, restrictions, or limitations as deemed necessary by the Board.