The Federal Board of Revenue has introduced a faster, risk-based sales tax registration system, allowing eligible low-risk businesses to secure registration within three working days.
The FBR issued Sales Tax General Order No. 20 of 2026 on August 24. The order aims to make registration faster and more transparent while maintaining checks against fake or fraudulent businesses.
Under the new mechanism, the FBR will screen every sales tax registration application submitted through the IRIS portal using computerised risk parameters.
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Applications classified as low-risk will receive priority. If an applicant submits all required information, the local registration office should complete the process within three working days.
FBR restricts demands for extra documents
The FBR has also instructed field formations to stop seeking unnecessary documents from low-risk applicants.
Officials can seek additional information only when the Sales Tax Act or Sales Tax Rules require it. They can also request documents needed to verify information or address a specific risk identified by the computerised system.
The order states: “No general or vague objection shall be raised.”
If an application requires further scrutiny, officials must record specific reasons electronically instead of leaving the case pending without explanation.
The FBR has also introduced a clear timeline for incomplete applications.
If documents or information are missing, incorrect or insufficient, the system must inform the applicant within seven days. The notice must identify the missing information and explain the deficiency.
Officials must also tell applicants how to correct the problem and provide a deadline for compliance.
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Once the applicant provides the required material, officials should continue processing the same application. The applicant will not need to restart the registration process.
The move addresses a longstanding concern among businesses over delays and repeated document demands during tax registration.
FBR’s existing guidance requires applicants to use their IRIS credentials and submit Form 14(1) for sales tax registration. Applicants provide details including bank information, business particulars, utility information and photographs of business premises. Manufacturers must also provide photographs of machinery and industrial electricity or gas meters.
Manufacturers get pre-registration facility
The FBR has introduced an additional facilitation mechanism for manufacturers.
Sectoral associations representing manufacturers under the Federation of Pakistan Chambers of Commerce and Industry can provide pre-registration certificates for member applicants.
The relevant association may confirm that the applicant operates, or intends to operate, in the stated manufacturing sector.
It can also verify whether the factory or business premises are identifiable and whether the activity matches the sector represented by the association.
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Associations may confirm membership where applicable. They can also check information submitted by the applicant against their available records.
The applicant or association will electronically send the certificate to the concerned local registration office along with the other required documents.
However, the FBR made clear that the certificate only helps accelerate verification.
It does not replace any requirement under the Sales Tax Act, 1990, or Sales Tax Rules, 2006. It also gives applicants no exemption, concession or immunity from sales tax requirements.
The order also places responsibility on trade associations for the information they certify.
If physical verification later reveals false information, the FBR can hold the concerned association responsible.
Local registration offices must conduct physical verification of manufacturers within three working days under Rule 5(5) of the Sales Tax Rules. Officials must record the result electronically and process the application without avoidable delay.
High-risk applications still face tougher checks
The faster procedure does not remove scrutiny for suspicious cases.
The FBR said the entire registration process will continue to operate on a risk-based system. High-risk or suspicious applications can face enhanced checks, including verification before or after registration.
Low-risk status also does not protect a business from later scrutiny.
The FBR can conduct subsequent verification if new information indicates misrepresentation, fake documents, non-existence of the business or another irregularity.
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The board has directed all Chief Commissioners Inland Revenue and Commissioners Inland Revenue to ensure strict compliance with the new order.
Pakistan has operated an automated sales tax registration system through IRIS since July 2019. FBR guidance also requires people registered through IRIS to complete biometric verification at a NADRA e-Sahulat centre within 30 days.
The latest changes focus on cutting delays for genuine businesses without weakening safeguards against fraudulent registrations.
