KARACHI — In a landmark move, the Federal Board of Revenue (FBR) and Sindh Revenue Board (SRB) have jointly resolved a long-standing dispute over sales tax on toll manufacturing, eliminating the risk of double taxation for businesses.
The joint statement, submitted to the Sindh High Court (SHC), follows months of deliberation and aligns with directives from the Supreme Court (June 6, 2024) and SHC (May 27, 2025). The agreement clarifies tax liabilities under both the Sindh Sales Tax on Services Act, 2011 and the federal Sales Tax Act, 1990.
Key outcomes include:
•     SST liability on toll manufacturing began July 1, 2013 via Sindh Finance Act.
•     Federal tax liability added July 1, 2015 via Finance Act 2015.
•     For July 2015–June 2022, payments to either authority will be treated as final (subject to verification).
•     SST exemption effective July 1, 2022 via SRB Notification No. SRB-3-4/21/2022.
•     No coercive recovery by either authority until December 31, 2025.
The SHC has officially disposed of all related petitions, marking a major step toward regulatory clarity and business confidence.