The Federal Board of Revenue (FBR) has notified 99 registered iron and steel manufacturers that will be subject to sales tax at the rate of Rs. 5 per unit of electricity consumed through electricity bills issued by their respective power distribution companies.
The notification, issued on Tuesday under the Sales Tax Act, 1990, and SRO 1245(I)/2026 dated July 31, 2026, applies to registered melters, rerollers, and composite units whose operations are integrated with the FBR’s computerized system.
According to the FBR, the notified manufacturers imported more than 70 percent of their scrap requirements during the preceding 12 months under the specified Harmonized System codes, including purchases made directly from importers operating under the Export Facilitation Scheme.
These imports exceeded 70 percent of their total purchases of eligible scrap during the period.
Under the notification, the sales tax will be collected through electricity bills issued by the relevant power distribution companies at a rate of Rs. 5 per unit of electricity consumed.
The FBR said the list of notified manufacturers may be revised from time to time by the board or on the recommendations of the relevant Commissioner Inland Revenue.
FBR added that the board and its field formations may independently review whether a registered manufacturer qualifies for inclusion or removal from the list based on the prescribed criteria.
The tax authority also said manufacturers facing any hardship under the new mechanism may approach the concerned Commissioner Inland Revenue for review and appropriate consideration.
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